Key Takeaways:
- The number of farms in New Zealand has declined by 33% over the past two decades, with the land area used for farming shrinking by 15% over the same period.
- Young farmers are finding it difficult to follow the traditional path to farm ownership due to the increasing cost of land and the need to save for longer periods.
- The agricultural sector is changing, with some farms growing into big businesses, while others are struggling to remain viable.
- Organizations such as the Young Farmers club are working to support young farmers and help them find ways to finance their way into farm or land ownership.
- Young farmers are having to be creative and find alternative ways to build equity and save for farm ownership, such as working off-farm or leasing land.
Introduction to New Zealand’s Agricultural Sector
New Zealand’s agricultural sector is undergoing significant changes, with the number of farms declining by 33% over the past two decades. According to data from the statistics agency, there were 70,336 farms in 2002, compared to 47,250 in 2022. The land area used for farming has also shrunk by 15% over the same period. Despite this decline, agriculture remains a major contributor to New Zealand’s economy, with dairy, meat, kiwifruit, and apples being major exports. The sector is also home to large businesses, such as the farmer-owned dairy co-operative, Fonterra, which recently sold its consumer businesses to French dairy giant Lactalis for nearly NZ$4bn.
The Challenges of Farm Ownership
For young farmers like Cam Clayton, the traditional path to farm ownership is becoming increasingly difficult. Clayton, who breeds sheep and cattle on a farm south of Auckland, is part of a changing sector where land is becoming more expensive, and prospective farm owners have to save for longer periods. "Someone buys the neighbor’s farm, then the next neighbor, suddenly you have a portfolio of five farms and Joe Bloggs the young farmer can’t buy a 150-cow farm to get started," Clayton says. This is a common challenge faced by many young farmers, who are struggling to find ways to finance their way into farm or land ownership.
The Young Farmers Club
The Young Farmers club, a 98-year-old institution, is working to support young farmers and help them find ways to overcome these challenges. Cheyne Gilooly, the club’s chief executive, says that finding a way to buy land is a frequent topic of discussion at the dozens of clubs throughout the country. "The big challenge at the moment is helping people finance their way into farm or land ownership as land gets more expensive," Gilooly says. The club provides a platform for young farmers to connect, share ideas, and learn from each other’s experiences.
Alternative Paths to Farm Ownership
For some young farmers, leasing land or working off-farm is becoming a more viable option. Cam Lowery, 27, and his partner Poppy Mitchell, 25, are one year into holding a lease for Lowery’s parents’ farm near Milton, south of Dunedin. They have 2,700 sheep, as well as some cows, calves, and hoggets. Lowery worked as a shepherd across the South Island before taking on the lease, but found it difficult to build equity through shepherding alone. "I just couldn’t see a way into farm ownership through shepherding," he says. Mitchell works as a physiotherapist in Dunedin during the week, while Lowery does all the farm work, with Mitchell’s help on weekends.
The Rewards of Farming
Despite the challenges, many young farmers are passionate about their work and enjoy the rewards that come with it. Clayton, who was a recent finalist at the Bay of Plenty-Waikato Young Farmer of the Year contest, loves the variety of life on the land. "I can’t get out of bed fast enough to see what challenges the day will throw at me," he says. The long-term plan is to own a farm with his partner, Emma, and he is willing to put in the hard work necessary to achieve his goal. For Mitchell and Lowery, the work is hard, but it feels worth doing. "My days start at 7 or 8 am and I keep working until 7 pm at the moment," Lowery says.
Conclusion
The agricultural sector in New Zealand is undergoing significant changes, with the number of farms declining and the cost of land increasing. Young farmers are facing challenges in finding ways to finance their way into farm or land ownership, but organizations such as the Young Farmers club are working to support them. Alternative paths to farm ownership, such as leasing land or working off-farm, are becoming more viable options. Despite the challenges, many young farmers are passionate about their work and enjoy the rewards that come with it. As the sector continues to evolve, it is likely that we will see more innovative and creative solutions to the challenges faced by young farmers.
