The trend of rural demographics concerns Guy Trafford, and those concerns aren't eased by data supplied by Stats NZ

In the process of trying of looking at what the average age of farmers in New Zealand was I came across an article which, while a couple of year since being first published, added to the vague uneasiness about the state of New Zealand farming.

It was a Stats NZ publication which mentioned that between 2002 and 2019 New Zealand has lost over 2 million hectares (13%) of productive farmland. Over this period while the average farm size increased the number of individual farms decreased by nearly 20,000 from just under 70,000 farms to just under 50,000.

The average size has increased from 224 ha in 2002 to 274 ha by 2019. Seeing a reduction in farmed area is not always a bad thing as during the late 1970’s farmland expanded with the government incentives into areas which hindsight has shown to be unsustainable to be farmed (i.e. steeper ’scrubland’ etc.) when the subsidies were removed. Some of this land has now returned to native shrubs.

As alluded to last week the subsidies of the 1970’s lead to a lowering of farmer age as more new/young farmers joined the industry. Along with them it also appears that there was a general resurgence in rural populations as seen in the below graph.

A 2017 MPI report on past policies stated in regard to the reforms “Some of the negative impacts were mitigated through assistance available in the form of an exit package and some debt restructuring by the Government. Despite the hardships, very few farmers left the sector, with only about one percent of farmers taking exit packages and about five percent of farmers leaving the land between 1985 and 1989. These numbers are not significantly greater than the normal rate of farm bankruptcies. It was predicted that up to 8,000 farmers, or 16 percent, would leave the land – in fact the number was closer to 800.”

Unfortunately, the removal of subsidies and other rural services has led to the general depopulation of the rural sector to the point where New Zealand is now one of the most urbanised societies in the world. In the period where MPI say 800 farmers left the land, the World Bank data shows a rural depopulation of around 20,000. The result is we now sit in the top 50 most urbanised countries in the world, slightly ahead of Australia. Approximately 87% of our population reside in urban settings. Perhaps not what the common impression is. New Zealand is fortunate in that although as a percentage the rural population is decreasing, the actual population is increasing and as the area being farmed is increasing there still should be a labour source to work the land.

Despite the concerns of too much land going into forestry and being the most recent driver of rural depopulation, assuming the numbers are accurate, in 2001 there was 1.8 million ha in plantation forestry whereas in 2019 there a tad under 1.7 million ha.

What none of these numbers show however, is where the depopulation is occurring.

It tends to be in the areas that can least afford it such as East Coast New Zealand parts of rural Southland and the like. The current mode of both major parliamentary parties to centralise services will mean this trend is not going to be reversed anytime soon.

Since 2019 no doubt some additional plantation planting has occurred but this comes on top of the 13% farming losses. This the leads to the conclusion that urban sprawl is the major contributor to the reduction of land. This has been covered recently with the government now putting restrictions on the amount of land use change permissible but as with all policies it takes a while to redirect the ‘ship’ with existing permits allowed to run their course.  So, this takes me back to the issue raised last week around the aging demographic of New Zealand farmers.

Given the land area has reduced by 13% and the number of farms by 20,000 the true issue around the age of New Zealand is actually a lot worse than the initial stats would indicate.

It is a similar issue that concerns New Zealand wool growers. If it wasn’t for the fact that the New Zealand sheep flock has decreased by almost two thirds (and falling) there would be a major panic about where the shearers are coming from. As it is those within the industry are concerned. Unfortunately StatsNZ were not able to shed light on the data as in response to an enquiry for demographics I was supplied data which stated there were (only) 5,400 sheep farmers in New Zealand and any further mining of data was going to cost $155 per hour. I replied I didn’t have confidence in any future data emanating from the Department, given that in fact there are about 23,000 sheep and beef farmers. Hopefully the next census comes up with some better (more useful) data.