March was very busy in the horticulture region with prices up to $1.35 million a canopy hectare for gold kiwifruit and $450,000 to $500,000 a canopy hectare for green variety. Those numbers do include this season’s crop, Real Estate Institute rural spokesman Brian Peacocke said.
The evidence is that even in fringe kiwifruit areas prices for orchards are better now than the top prices achieved in the good areas 18 months ago.
Bay of Plenty had a jump of farm nine sales in the three months to the end of March, compared to the three months to the end of February, though on a year-on-year basis there were 14 fewer sales in the province, institute figures showed.
Peacocke said kiwifruit orchard sales activity is expected to tail off heading into the harvest season and is expected to be quiet until spring when pruning and tying have been completed and new growth emerges.
That would fit in with the slower market across most sectors though in the year to the end of March there was a 19% lift in sales of grazing properties and 4.5% more arable farm sales, where numbers tend to be low anyway.
Dairy farm sales were down by 28% compared to the previous years and finishing farm sales were down by 16.3%.
There were mixed reports on farm prices.
For all farms, the median price per hectare year-on-year fell 14.7% but the institute’s all-farm price index rose nearly 12%. For dairy farms the year-on-year median price/ha rose 9.9%, well ahead of the dairy farm index increase of 3.2%.
The index figures are regarded as the best measure because they allow for differences in farm size and location and in the case of the all-farm index the type of farming as well. The median price measure does not do that.
Nationally, the number of farms sold over the year to the end of March was 1448, down 4.3% on a year earlier.
Peacocke said the data shows a fall of 57 in the number of farms sold in the three months to the end of March, compared to the same time last year. Compared with two years ago there were 107 fewer sales.
“Significant changes are occurring within a number of the land-use categories, apart from horticulture, which, while down marginally from the March quarter two years ago, has experienced a 21% lift from the volumes in the March quarter of 2018.”
The drivers for the drop in sales are receiving considerable publicity and include more farmers retiring, pressure on profitability as a result of increasing costs, increasing difficulty in obtaining qualified labour, more compliance demand across a range of issues, indications of a lack of empathy from the Government and volatility of income and climate, he said.
There are other reasons as well but also encouraging factors such as interest and exchange rates at good levels and good income for lamb and fine wool, solid for beef, improving for dairy and excellent for some of the horticulture products.
Overall, there is a feeling of caution in the rural sector.
For dairy farming there was a lower level of sales in Northland, Waikato and Bay of Plenty, light activity through the lower North Island and minimal sales throughout the South Island.
Finishing farm sales in Northland, Auckland, Waikato and Taranaki were reasonable, there were strong volumes in Manawatu-Wanganui, and good activity across the South Island.
Most of the North Island is benefiting from good grazing sale volumes with Canterbury and Marlborough levels modest while Otago and Southland have the strongest South Island results.
For all farms sold in NZ in the three months to the end of March the median price was $23,383/ha, down from $27,428/ha a year earlier. However, there was a 4.1% gain from February to March this year.
The institute’s all-farm index rose 0.4% February to March and had an 11.9% year-on-year improvement.
For dairy farms the median sale price for the latest March period was $37,100/ha (43 sales), up from $35,807/ha (55 sales) in the February period and $33,750 (80 sales) in the March period last year. The dairy farm index fell 4.6% February to March but rose 3.2% year-on-year.
For finishing farms the median price for March was $31,059/ha (80 sales), up from $28,872 (106 sales) for February and from $30,044 (132 sales) for March 2018, a year-on-year gain of 3.4%.
The median price for grazing farms was $10,373/ha (117 sales) for the March period, up from $9700/ha (124 sales) in February but below the $10,682/ha (103 sales) for March last year. The year-on-year fall was 2.9%.
Despite the big recent Bay of Plenty prices, median levels are down in horticulture, at $240,064/ha (46 sales) for March, compared to $277,901/ha (38 sales) in March last year, a 13.6% fall. However, prices are well up from the $164,176/ha (36 sales) median figure for the latest February period.
