Report

Mid-Season Farm Confidence Survey - February 2022

This report summarises the February 2022 Federated Farmers’ Mid-Season Farm Confidence survey results. The survey is undertaken twice a year (January and July); this study is the 26th iteration. The survey was completed for Federated Farmers by Research First, New Zealand’s leading agricultural market research company.

Key points follow: 

  • General economic conditions (current): A net 7.8% per cent of respondents consider current economic conditions to be good, a 10.1-point decline from July 2021 when 17.9% considered conditions to be good. 
  • General economic conditions (expectations): A net 64.0% of respondents expect general economic conditions to worsen over the next 12 months, a 25-point decline on the July 2021 survey when a next 39.0% expected them to worsen. The survey was done before Omicron’s rapid spread and before the Russian invasion of Ukraine both of which will weigh on economic growth.
  • Farm profitability (current): A net 61.1% of respondents reported making a profit currently, a 5.5-point increase on the July 2021 survey when a net 55.6% reported making a profit. 
  • Farm profitability (expectations): A net 11.2% of respondents expect their profitability to decline over the next 12 months, a 16-point decrease on the July 2021 survey when a net 4.4% expected it to improve. 
  • Farm production (expectations): A net 1.8% of respondents expect their production to increase over the next 12 months, a 13.4-point decrease on the July 2021 survey when a net 15.3% expected it to increase. This is quite a drop and it was before February’s heavy rain which caused a lot of damages and loss for arable.
  • Farm spending (expectations): A net 52.7% of respondents expect their spending to increase over the next 12 months, a 20-point increase on the July 2021 survey when a net 32.6% expected it to increase.  This will be due to higher expected prices rather than farmers feeling confident to spend and invest. And this is before the impact of higher energy prices following the Russian invasion of Ukraine.
  • Farm debt (expectations): A net 30.9% of respondents expect their debt to reduce over the next 12 months, a 1.7-point increase on the July 2021 survey when a net 29.3% expected it to reduce. 
  • Ability to recruit (experienced): A net 48.6% of respondents reported it has been harder to recruit skilled and motivated staff, a 0.2-point decrease on the July 2021 survey when a net 48.8% reported it has been harder. So still really, really hard to find staff.
  • Greatest concerns (current): The three greatest concerns for farmers are climate change policy and ETS (chosen by 18.7% of respondents), followed by regulation and compliance costs (13.1%), and freshwater policy (9.5%). This result is unchanged from the July 2021 survey.  I suspect the global economy will be right up there if the survey were done right now.
  • Highest government priorities (current): The three highest priorities farmers would like the Government to address were the economy and business environment (15.0%), fiscal policy (12.1%) and regulation and compliance costs (11.7%). This compares to the July 2021 survey when the top three priorities were regulation and compliance costs (14.0%), economy and business environment (13.1%), and supporting agriculture and exporters (10.4%).
To read the full report click opposite