The Detail today looks at why farmers are at a low point, and pessimistic in spite of strong commodity prices.
Farmers are feeling under siege over environment issues – and it’s dragged their confidence to the lowest point in three years.
Farmers’ outlook for the rural economy for the next year has dropped to a net minus 33 percent, from minus two percent three months ago.
“The drop of this magnitude is significant,” says Rabobank agricultural analyst Blake Holgate. “It follows three quarters where confidence was gradually increasing.”
And it’s likely to fall further by the end of the year, as the next survey will ask farmers how they feel about new freshwater reforms.
“Essentially we ask, ‘do farmers think the rural economy is going to get better, stay the same or get worse over the next 12 months’ and then we take away those who think it’s going to get worse and those who think it’ll get better and that shows us if farmers’ confidence is positive or negative,” Holgate says.
“So, net negative 33 means those who thought it was going to improve have declined and those who thought it would get worse have increased, so farmers are more pessimistic and less optimistic.”
“Big, chunky” environment issues and government policies such as the zero carbon bill are rattling farmers. They’re worried about how they’ll meet proposed regulations that will require them to reduce methane by 10 percent by 2030, and a tougher reduction by 2050.
Fonterra’s poor performance, tighter lending rules by banks, Brexit and other international trade uncertainties, and a proposed crackdown on winter grazing practises are also making farmers gloomy. Add to that the Mycoplasma bovis crisis.
“That’s seen so far just under 200 farms infected,” says RNZ rural reporter Maja Burry. “All of those cows on those properties are going to be culled, most of them already have been. There’s been just over 113,000 cattle culled in total as part of the M.bovis response.”
But it’s the growing urban-rural divide that’s really hurting.
Federated Farmers president Katie Milne told Burry she was really worried about the mood of the sector. Farmers are feeling the pressure of growing public scrutiny over environmental issues, some have received death threats on Facebook, and some of their children are being bullied.
“Farmers do feel a little bit under siege when actually commodity prices are good,” Milne says. And it should be acknowledged that farmers are trying out different innovations to make their farms more sustainable.
“They should be able to be looking forward and optimistic. It’s really such a shame that we have our people actually in such a bad place at the moment.”
Want more from The Detail? Find past episodes here.