The Real Estate Institute of NZ's Dairy Farm Price Index sank 24.1% in the three months to April compared to the same period of last year.
And versus the three months ended March the Index was down 3.5%.
The Index reflects the prices of dairy farms sold in the previous three months, but is adjusted to reflect differences in farm size and location, to give a more consistent measure of price trends.
There was an even bigger fall in the number of dairy farms being sold, with 52 sales recorded in the three months to April compared to 97 in the same period last year.
On a price per kilogramme of milk solids produced, the median selling price was $32.46/kg in the three months to April compared with $36.36/kg (-10.7%) in the same period last year
However outside of the dairy sector the rural outlook was a lot less gloomy.
The REINZ All Farm Prices Index, which measures movements in the prices of all types of farms sold (adjusted for size and location), was down just 0.6% in the three months to April compared to a year earlier, although there was a bigger fall in the number of sales.
There were 407 farms of all types sold in the three months to the end of April compared to 485 in the same period last year, down 16%.
"As autumn colours signal the winding down of the growing season, so are sales volumes easing as the market heads toward the dormant months of winter," REINZ rural spokesman Brian Peacocke said.
"Bright spots in the rural sector during autumn include record demand and prices for weaner beef cattle, a substantial increase for organic milk from Fonterra for those few farmers fortunate enough to have persisted with organic supply, and widespread demand for land suitable for growing manuka for future production of honey."
However while many true farmers may struggle, the lifestyle block market is booming.
According to the REINZ, 2375 lifestyle blocks were sold in the three months ended April, compared to 1940 in the same period last year (+22.5%).
And the national median price of lifestyle blocks set a record high of $562,500 in the three months to March, up 1.8% compared to a year earlier.
"Strong volumes of sales and prices in the three months ending April 2016 confirms confidence in the lifestyle market throughout the country," Peacocke said.
"As a result, a number of regions report increasing difficulty in locating sufficient property to meet the demand."
Farm sales
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29 Comments
..dont know if you ever fly in or out of Hamilton Murray, but the mcmansion sprawl of manicured lawns, tennis courst and pools is extroadinary. One could fit an entirely new city into the southern sprawl sth of Ham and Nth of Cambridge. The planners should call bluff and allow all of this to become pocket size sections.....then watch section prices drop. But nope, the city elite all live here....the sit and are waiting for the bonanza.
Ditto Auckland.
Its called Tamahere, great community , markets , community hall , good schools , close to golf , airport ,hospital 90 minutes Akl, Has exploded in past five years . Generally a wide mix of people just going about life not worried about house prices nor section size.
I agree with you IT GUY, it is a big fall already and I don't think we have seen the worst of it yet.
Just look at the way European countries are still increasing their production every month, and Fonterra are losing so much of the chinese market share.
At present, everything points to further downwards pressure on prices and more pain to come.
I know of plenty of farms that need in excess of $6/kg to break even, and they are all hanging on by the skin of their teeth and will not make it through another season.
Not to be all negative though, read the stories behind the competitors in the dairy industry awards, and it is clear that good farmers are still making money and finding opportunities in this environment which is great to see and sets a great example for others.
the news release is below - price per H only down 13%
For the three months ended April 2016 the median sales price per hectare for dairy farms was
$33,507 (52 properties), compared to $33,897 for the three months ended March 2016 (48
properties), and $38,802 (97 properties) for the three months ended April 2015. The median price
per hectare for dairy farms has fallen 13.6% over the past 12 months. The median dairy farm size for
the three months ended April 2016 was 124 hectares.
On a price per kilo of milk solids basis, the median sale price was $32.46 per kg of milk solids for the
three months ended April 2016, compared to $35.00 per kg of milk solids for the three months ended
March 2016 (-7.2%), and $36.36 for the three months ended April 2015 (-10.7%).
Included in sales for the month of January were 18 dairy farms at a median sale value of $33,141 per
hectare. The median farm size was 128 hectares with a range of 65 hectares in Waikato to 409
hectares in Canterbury. The median production per hectare across all dairy farms sold in April 2016
was 834kgs of milk solids.
The REINZ Dairy Farm Price Index fell 3.5% in the three months to April compared to the three
months to March. Compared to April 2015, the REINZ Dairy Farm Price Index fell by 24.1%. The
REINZ Dairy Farm Price Index adjusts for differences in farm size and location compared to the median
price per hectare, which does not adjust for these factors.
have a look at farm debt
Dairy 'super downcycle' now on, says Rabobank
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=116…
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