Ele Ludemann: Farmer confidence up but . . .

Farmer confidence has risen but that’s off record lows:

Concerns about high interest rates, poor commodity prices and excessive red tape are weighing heavily on farmers, but rural confidence has risen from last year’s record lows.

Federated Farmers’ latest Farm Confidence Survey shows there’s been a positive shift in the rural mood since 2023, when confidence reached its lowest point in the survey’s 15-year history.

“It’s good to see the first improvement in farmer confidence for quite some time now,” Federated Farmers national president Wayne Langford says.

“I want to be clear that it’s only a slight improvement and it’s coming off a very low base. I wouldn’t say farmers are feeling more confident yet – they’re just feeling less unconfident.

“Confidence is no longer going backwards, but it’s still in the gutter.”

Langford says farmers are struggling with high inflation, high interest rates and lower commodity prices, and the impact of those on their profitability.

“Most farmers are still feeling that general economic conditions are bad, and most are still making a loss.

“Where we are seeing a shift is in the number of farmers who expect things will improve in the next 12 months. So, times are tough, but there’s a sense of cautious optimism.”

Compared to last July, the January 2024 survey shows more farmers expect their production and spending to increase, and fewer farmers expect their debt to increase, in the 12 months ahead.

Langford says there are a number of drivers behind the confidence recovery.

I’ve had a tent raising awareness of ovarian cancer at the Wanaka show four times.

Last weekend raffle sales raised a little more than half the amount we made the other three times.

I think that’s a sign of the times, the impact that the cost of living crisis is having in general and more specifically on farmers.

It’s always a very relaxed and social couple of days and people were enjoying themselves but lots spoke of how tough farming is at the moment.

With high interest rates and inflation, lower prices for milk and beef; and very low returns for wool and sheep meat, it’s reminding us of the ag-sag of the 1980s.

There is an important difference though. Back then government policies hit farmers hard. Now we’ve got a government that understands the importance of farming and the need to reduce the complexity and costs of compliance imposed over the last six years.

Ele Ludemann is a North Otago farmer and journalist, who blogs HERE - where this article was sourced.