Farmer confidence at record low

Farmer confidence is at its lowest level since Federated Farmers began its twice-yearly surveys in 2009.

Of the responses from nearly 1000 farmers from around the country to the January farm confidence survey, a net 7.8% considered current economic conditions to be good.

That was a 10.1-point decline from the organisation’s July survey, when 17.9% considered conditions to be good.

Looking forward, a net 64% of farmers believed general economic conditions would worsen over the next 12 months, a 25-point deterioration from the 39% in the July survey.

Listing their greatest concerns, those completing the January survey chose climate change policy and the emissions trading scheme, followed by regulation and compliance costs and freshwater policy.

In a statement, Federated Farmers national president Andrew Hoggard said the results were more disturbing considering farmers answered the survey before the surge of Omicron cases in New Zealand and Russia’s invasion of Ukraine, both of which would weigh on economic growth.

While a net 61.1% of farmers reported making a profit, a 5.5-point increase on July 2021, a net 11.2% expected their profitability would decline in the year ahead, 16 points down on six months earlier when a net 4.4% expected profitability would improve.

While there were strong returns on meat and dairy thanks to high global demand and food security concerns, much of that revenue was ‘‘going right back out again" with higher fuel and fertiliser prices, rising labour costs and the hot inflation that was affecting New Zealanders.

Last year’s survey pinpointed the sector’s struggle to fill workforce gaps as a huge issue, nearly half of respondents stating it was harder to recruit skilled and motivated staff. January’s result shows negligible improvement, of just a 0.2-point decrease on that finding.

The three highest priorities respondent farmers wanted the Government to address were the economy and business environment, fiscal policy,and regulation and compliance costs.

Yesterday, Groundswell New Zealand co-founder Bryce McKenzie said the rural group would be putting forward its own emissions reduction proposal, describing those under the He Waka Eke Noa partnership as ‘‘unworkable".

"None of the options are workable and, like the Emissions Trading Scheme, they will deliver worse outcomes for the environment, farmers and our country," Mr McKenzie said.

Groundswell NZ’s alternative was an integrated environmental policy framework incentivising and enabling on-the-ground actions across all aspects of the environment, including freshwater, indigenous biodiversity, and emissions.

"Farmers are already on-board with addressing environmental issues but are hugely frustrated with endless unworkable policies made in silos. There is significant momentum at the grassroots level to embrace integrated environmental management, including emissions.”

"Along with the integrated environmental policy framework, we also propose a short-term research fund to develop credible emissions reduction alternatives for the agricultural sector to implement.”

"Then a new, more comprehensive emissions plan can be workably introduced, tailored towards incentivising and enabling the uptake of alternatives and technology as they are developed,” he said.

The full integrated environmental policy framework was still being developed, although initial proposals included both replacing the controversial Significant Natural Areas policy, and a catchment-by-catchment approach to freshwater, he said.