New Zealand dairy farm prices have soared recently despite the significant drop in milk prices over the past months.
The REINZ Dairy Farm Price Index rose by 7.3% in the three months to October compared to the three months to September.
Compared to October 2013, the Dairy Farm Price Index rose by 34.4%.
Included in sales for the month of October were nine dairy farms at a median sale value of $31,873 per hectare. The median farm size was 117 hectares with a range of 51 hectares in the Waikato region to 328 hectares on the West Coast. The median production per hectare across all dairy farms sold in October 2014 was 1,062 kgs of milk solids.
For the three months ended October 2014 the median sales price per hectare for dairy farms was $43,299 (23 properties), compared to $40,462 for the three months ended September 2014 (20 properties), and $32,701 (37 properties) for the three months ended October 2013. The median dairy farm size for the three months ended October 2014 was 97 hectares.
The median price per hectare for all farms sold in the three months to October 2014 was $27,898 compared to $24,590 recorded for three months ended October 2013 (+13.5%). The median price per hectare rose 7.3% compared to September.
The All Farm Price Index fell 0.1% in the three months to October compared to the three months to September, moving from 3,127.7 to 3,123.2. Compared to October 2013 the REINZ All Farm Price Index rose by 1.9%. The REINZ All Farm Price Index adjusts for differences in farm size, location and farming type, unlike the median price per hectare, which does not adjust for these factors.
Six regions recorded increases in sales volume for the three months ended October 2014 compared to the three months ended October 2013. Northland recorded the largest increase in sales (+20 sales), followed by Nelson (+14 sales) and Auckland (+6 sales). Compared to the three months ended September 2014, eight regions recorded an increase in sales.
“Sales figures for the three month period ending October reflect an awakening market, with a strong build-up moving into spring”, says REINZ Rural Spokesman Brian Peacocke, “a large number of properties throughout the North Island have been marketed during October, but with unconditional dates after the end of the month the results will not be known until the November data is available.”
“Feedback from around the country indicates strong buyer enquiry, careful due diligence being undertaken by purchases and a market fully firm on last season.”
