Farmer confidence knocked as escalating financial costs put pressure on mental wellbeing

Rising fuel and fertilizer costs and debt service levels have shattered rural confidence and sparked mental health concerns, prompting farmers facing difficult times to ‘talk to someone’.

Industry representatives say farmers will
Tightening the belts, some were skeptical about the future in the sector despite some strong agricultural economic performance.

Farmers are being squeezed by rising interest rates, and debt and other financial concerns are hurting their mental health, according to the Federated Farmers November Banking Survey.

President and economic spokesman Andrew Hoggard said this reflected the impact of higher official cash rates, and while many other Kiwi households and businesses were also feeling the pinch, many farms I had a lot of debt.

Since the May survey, the average farmer’s mortgage value has risen from $4.07 million to $4.19 million, and the median has risen from $2.25 million to $2.5 million.

Average overdraft levels rose $46,000 to $328,800, with an average interest rate of 8.59%.

“It is not surprising that just over 40% of farmers said their mental health was being affected by debt levels, interest rates, changing circumstances, or other forms of economic pressure. is not.”

Agriculture spending surged 15% in the September quarter compared to the previous September, led by increases in fuel (53%), fertilizer (37%) and debt service (34%), he said. .

Sam McIvor, CEO of Beef + Lamb New Zealand, said the company’s Lamb Crop 2022 report shows a stark contrast between results and farmers’ sentiment.

He said sheep and beef farmers had improved in difficult circumstances, but some still had “very low” confidence about the future of the $12 billion a year export sector.

“This is exacerbated by concerns that prices may ease next year, albeit from record levels.”

Others said they were considering exiting sectors that could impact their employees, businesses and communities.

“It’s important to remember that farmers have a lot of support from the public.”

The cost of all agricultural inputs will rise in 2022 and may rise further in 2023 and 2024.

“Farmers can defer repairs and maintenance, use less agricultural inputs such as fuel to meet rising costs of running their farms, and pay more interest on debt.”

Due to a tight labor market and inflation, farmers are also facing higher interest rates and skyrocketing prices for contractors, traders, machinery, infrastructure or vehicle parts, McIvor said.

DairyNZ CEO Dr Tim Muckle said dairy farmers are facing regulatory changes, weather issues, staffing and inflation.

“Despite these challenges, our farmers remain world leaders, with dairy exports reaching a record $22 billion.” He said it contributed $50 billion to the economy.

Through government border class exceptions, 768 international dairy employees and their families have been nominated to fill critical farm vacancies, and the sector has positioned farming as a competitive career option, with a We have started a plan to expand our power.

Milk prices have been good for several years, but dairy has reduced its debt by $5.2 billion from 2018 to 2022. “This is great news.”

But rising day-to-day costs and the impact on farm profitability will be on the back of the minds of many this year.

Labor costs increased by about $1 per kilogram of milk solids last season.

He expected many farmers to spend conservatively, especially on non-essential purchases during the current season.

Colin Guyton, president of Rotorua Taupo Federated Farmers, said farmers are all talking about costs. For example, 18 months ago it cost him $450 to fuel his largest tractor tank, now it costs him $1000.

He said farmers want some less fat and expect to use less fertilizer because of the high cost.

Rising interest rates and rising wages due to labor shortages are also concerns.

“You definitely have to watch your pennies. is.

“And some have realized they’re actually in a tough spot right now, having made the mistake of paying a large amount.”

Rick Paudrel, a beef and sheep farmer in Te Puke, said the biggest cost issues were fuel, fertilizer and interest rates.

Farmers were also conscious of paying their workers fairly as wages rose in other industries.

He said 20 cents would go off the lamb schedule in one week alone and the farmer wouldn’t be able to put it back into lamb in one week.

“Rising costs and falling prices are putting a lot of pressure on people, and the mental health aspect is huge.”

Farmers for Positive Change chairman Rick Burke said many farmers had gone through difficult times before and were able to talk about it with others. Consultants and industry representatives are also helpful.

“I have no choice but to talk to someone. There are things I can do.”

He suggested that farmers struggling with fertilizer costs consider strategically where they use fertilizer.

A sheep and beef farmer who has been in the industry for at least 35 years said the pasture has been growing well so far and it has been a great season.

Some farmers were working hard to turn everything into silage or hay, but it might be better to close the gates and go surfing or fishing, he said.

Governor Brent Mountford of the Bay of Plenty Federated Farmers said a “double blow” had hit revenues as lamb prices were back $2 from last year.

Shear costs jumped and could have gone up by 30% due to another big impact.

On the bright side, he was grateful that the rain and green grass allowed the farmers to keep their stocks in good condition.

where you need help

If it’s an emergency and you or someone else is in danger, call 111.

for counseling and support

life line: call 0800 543 354 or text 4357 (HELP)

suicide crisis helpline: Phone 0508 828 865 (0508 TAUTOKO)

need to talk? call or text 1737

depression helpline: call 0800 111 757 or text 4202

for children and young people

youth line: call 0800 376 633 or text 234

What’s wrong: Phone 0800 942 8787 (11am-11pm) or Web Chat (11am-10:30pm)

Help on specific issues

alcohol and drug helpline: Phone 0800 787 797

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overview: Phone 0800 688 5463 (0800 OUTLINE) (6pm-9pm)

All services are free and available 24 hours a day, 7 days a week unless otherwise specified.

For more information and support, contact your local doctor, Hau’ola, community mental health team, or counseling services.Mental Health Foundation has more helplines and service contacts on that website.