Federated Farmers report decade-high profitability amid rising uncertainty

A recent survey by Federated Farmers indicates that farm profitability in New Zealand has reached its highest level in a decade, with 72% of farmers reporting a profit and fewer than 5% reporting a loss.

Despite these strong current returns, particularly in the dairy, sheep, and beef sectors, there is growing concern regarding the next 12 months. Nearly 30% of farmers expect conditions to worsen, while only 12% anticipate improvement. Dairy farmers expressed the highest level of concern, with 39% expecting a downturn.

Key factors contributing to this declining forward confidence include rising input costs and on-farm inflation (33%), domestic politics and the upcoming election (30%), and regulatory compliance and red tape (23%).