NZ Rural Sector Stays Positive for Ninth Straight Quarter

New Zealand's rural sector remains optimistic for the ninth consecutive quarter, according to the latest Rabobank Rural Confidence Survey.

The survey, conducted between August 17 and September 4, found that 30% of farmers expect the broader agri-economy to improve in the year ahead, up from 29% in the previous quarter. The number expecting conditions to worsen also shifted marginally to 16%, while 52% of farmers expect conditions to stay the same.

Horticulturalists were the most positive group surveyed, with their confidence strengthened this quarter and now leading all sectors at +23%. Rising commodity prices, overseas markets, and increasing demand were cited as reasons for optimism by those who are positive about the sector. Negative sentiments focused on rising input costs (47%), followed by concerns over overseas markets (35%) and drought (27%).

Rabobank New Zealand chief executive Todd Charteris noted that while there is a growing list of farmer concerns, including elevated farm input costs and the recent escalation of hostilities in the Middle East impacting fuel and fertilizer prices, the income side of the balance sheet remains robust. He added that slowing global dairy production growth and restrained supply of beef and sheep meat are expected to support firm pricing for New Zealand's dairy and red meat products.