New Zealand farm profits could drop by over 30 percent

Published 2023년 3월 15일

Tridge summary

A report by Beef and Lamb New Zealand mid-season update 2022-23 predicts a 31% decrease in farm profit before tax to NZ$146,300 (€84,641) due to high inflation and reduced livestock prices. This is below the average for the past five years. The decrease is attributed to increasing on-farm costs, global demand drops, and supply tightness in the agricultural sector. Farmers are cutting costs by deferring repairs and reducing fertiliser use, but these cost-cutting efforts are offset by inflation and rising farm input prices. The report also highlights the financial challenges faced by farmers due to cyclones, extremely dry conditions, and government environmental policy changes.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

High inflation and reduced livestock prices could result in profits on beef and sheep farms in New Zealand falling by almost a third, according to a new report. The Beef and Lamb New Zealand Mid-Season Update 2022-23 says that farm profit before tax is estimated at NZ$146,300 (€84,641). This is a 31% decrease from 2021-22 and below the average for the past five years. Beef and Lamb New Zealand chief economist, Andrew Burtt said that inflationary pressure is causing on-farm costs to increase sharply, “eroding the benefit of what are still historically pretty good farmgate returns”. He said that a recovery is expected in global demand for sheepmeat and beef, while supply levels remain tight. This follows a stark drop in demand for sheepmeat at the start of the season before China relaxed its zero Covid-19 policy. “As 85% of New Zealand’s mutton exports are to China, this impacted export receipts, which were one third lower compared to the same period last season,” Burtt said. ...

Source: AgriLand