This guy McDonald appears to be wrong, always, you can hang your hat on it. Fact is you cannot sell a business that is losing money with no obvious way of turning the losses around. The market is dead and prices will fall to maybe less than a third of 2007 levels ,banks will be looking at losses of over 25 billion in the rural sector. Next year may be much worse than this.

Just a personal brainwave:
I think this site is increasingly becoming like a "Blog Warehouse" with increasingly daily addition of articles, but unfortunately with increasingly less value = less interesting discussions.

"farmers appear to be sitting out the unseasonal wet weather before putting their properties on the market resulting in a slow September for rural sales"

excuse me?! What is Spring weather in N.Z. usually like??
So easy to poke holes in a lot of what comes out of R.E.

there is a site that i follow [reaestate .co.nz --dairy propertys] it has day of listing
last month 60+ this month 31 so far --as of today--sales are 1 a week?
wheres the demand

Ponzi, Ponzi, Ponzi, oi, oi, oi.

Soemwhere, sometime, some place on this site on some blog quoted a revered and respected analyst saying "NZ farming could be the sub-prime of the South Pacific." Or words to similar effect. Anyone remember? Is this it? If not, when?

The MAF Farm monitoring reports use actual farm figures. Sheep and Beef farm - cost $3m. Personal drawings $58k. First surplus for 3 years $50k. Out of that $50k you have to pay tax and fund development. How can that be economic? If you had $3m would you be happy with less that $50k surplus per year after working 7 days a week?

How can a lender lend money on these figures? Answer - they have factored capital gains which are now non existent.

That is the state of farming in NZ.

Trouble is farmers are price takers dicktated by things out of our control I think realy we are nuts for working for what we get paid perhaps sheep farmers should refuse to finalise there there books un till the pricks that wheel and deal in our dollar have to pay tax on there profits I am getting tired of meadlers who's biggest delemer is weather to take there umbrella to work or not

Thanks for that post andrewj - as you clearly reveal there are large numbers of dairy farms for sale - yet the REINZ doltard is claiming farmers are holding back listing. Of those huge numbers a mere 5 sold????

Sounds like a few frustrated famers out there, tough game when you are price takers.
NZ is in the uncanny position of having a high dollar and low interest rates. I notice inflationary pressure is rearing it's nasty head. What will be RBNZ's response?. If the OCR is headin up where will the carry trade take our currency?. Where will the currency take our exporters?. Where will our export return take our generated tax revenue. Where will large increases in ACC take farmers ablility to generate profit and therefore tax. Do you think a 70% increase in levies reverses the reduction our tax generated be positive. Are we robbing Peter to pay Paul?

@PeterR, thanks, that's the one. The part I was trying to refer to was:

Mr Elworthy's newsletter expressed concerns that dairy could become the "subprime of the South Pacific", as too many farmers were over-leveraged. "If the New Zealand dollar continues to be strong then a number of NZ dairy farmers who purchased at high land prices will be insolvent," he said.

I guess it'll be ok though because solids price will keep rising (as it always does...) and the Kiwi will behave, errr, but I ain't betting on, either...

The GG is such a God-send eh?

Bernard,

Farmers dont deliberately make losses. They are really lucky. Losses happen naturally.