Dairy farmers culling stock, reviewing surplus assets with farm prices down 12.1% over past year - REINZ

Dairy farm prices have fallen by 12.1% over the last 12 months as lower milk prices take their toll, according to the Real Estate Institute of NZ.

The REINZ Dairy Farm Price Index, which adjusts selling prices to allow for differences in farm size and location, was down 13% in the three months to July compared to the three months to June, and down 12.1% compared to a year ago.

"The recent Fonterra dairy payout announcement confirmed widespread expectations within a marketplace anticipating a downturn in the current season. The key issue for many is the time prices are likely to remain at current levels," REINZ rural spokesman Brian Peacocke said.

"Across the board, culling of lower performing animals is evident, and the retention of surplus assets is under review," he said.

"By contrast the news is brighter for other sectors with record prices being paid for beef, good prospects for lamb, improving prices for wool and an improving market in the kiwifruit and pip fruit sectors," Peacocke said.

The REINZ All Farm Price Index, which tracks movements in the prices of all farm types and adjusts for variations in size and location, was down 2.9% in the three months to July compared to the three months to June, but was up 3.9% compared to a year earlier.

The lifestyle market remained buoyant, with sales of lifestyle blocks up 36.4% in the three months to July compared to a year earlier.

The national median price for lifestyle blocks was $555,000 in the three months to July compared to $525,000 in the same period last year.

In Auckland the median price of lifestyle blocks was $947,500 in the three months to July compared to $897,500 in the same period last year.