The results of the Federated Farmers survey on profits and risks have been published

Federated Farmers has presented the results of its 35th biannual farm confidence survey, which examined the state of 634 farms. It turned out that nearly 68% of the surveyed participants are currently profitable. The meat and wool sectors are in the lead (78% of profitable farms), followed by the dairy sector (74%). At the same time, current financial conditions for crop farmers are deteriorating: almost one in four representatives of this sector is operating at a loss.

The main cause for concern among farmers has been high operating costs, in particular for fertilizer, fuel, feed, freight, and insurance. The situation has been exacerbated against the backdrop of events in the Persian Gulf region lasting seven months and leading to a sharp rise in prices for key export commodities. About 30% of farmers expect conditions to worsen next year, while only 12% forecast an improvement. The greatest concerns are expressed by dairy farmers — 39% of them expect a downturn next year. Crop farms report negative economic conditions, plans to increase debt, and a deterioration in well-being, with 70% of loss-making farmers of this profile noting the impact of the situation on their health.

Organization President Colin Hurst noted the record profitability of the sectors, but pointed to caution in forecasts due to continued cost increases and falling international grain and seed markets. Additional uncertainty for farmers is created by the upcoming general elections in November and political anxiety associated with unfinished reforms in resource management. At the time of the survey, the Reserve Bank raised the official cash rate for the first time in three years to 2.50%, Fonterra lowered its forecast milk price for the 2026/27 season, and Stats NZ reported a two-year high in annual inflation at 4.1%.

Despite concerns, more than half of the surveyed farms plan to increase production expenditure, and about 40% expect to reduce debt, while crop farmers mostly intend to increase borrowing.