Who owns farming in NZ?

"Small farms are part of the New Zealand culture, whereas I believe the mega-farming that is starting to appear now in New Zealand is not" - David Miller - dairy farmer in Otorohanga.

As New Zealand farming has become more and more industrial, small, family-owned farms are being snapped up, subsumed into industrial-scale dairying operations. This has totally changed the face of farming in New Zealand.

As the number of individual dairy farms drops, the size of dairy farms is increasing. There were 16,843 dairy farms in New Zealand in 1994. There were 12,810 in 2005. According to a study by Bayleys Rural Land Marketing Manager Blair Stevens, that could fall to 5000 in the next ten years.

Meanwhile, the price of rural land has skyrocketed. An average dairy farm now costs around $3 million with some farms now costing a whopping $30 million. The dream of farm ownership for thousands of young kiwis is rapidly evaporating.

The best many can hope for now is to own an equity share, or work on wages for agribusiness companies that buy up properties with investment funds.

New Zealand companies such as Dairy Holdings, FarmRight, AGinvest and MyFarm offer various options, such as shares, perhaps the opportunity to work on their investment farms, building up equity as they go. Some are already farmers, looking to expand their businesses. In some cases, non-farming investors are essentially "sleeping partners," providing capital only.

David Miller is a dairy farmer in Otorohanga. He and his wife Ailsa have 80 years of milking cows between them.  "There are now something like 8,000 farmers and 11,000 farms," he says. "That's a lot of missing farmers; around 3,000 farms run by absentee investors."  

MyFarm has spent more than $55m on dairy syndicates in recent months, and manages 21 corporate dairy farms with over 14,000 cows and dairy support on 7400ha in New Zealand and 500ha in Australia.

Dairy Holdings began corporate farming in 2001. It operates 58 dairy farms in the South Island totalling 17,500 hectares, milking 46,511 cows.

Around a third of its farms - mostly smaller units up to 800 cows - are run by 50/50 'sharemilkers', who provide the livestock, plant and machinery while the company owns the land.

Other companies, such as Australian investment giant Timbercorp, which has sought $150m for investment in New Zealand and Australian dairy farms, attract foreign investors looking to capitalise on New Zealanders dairy profits.

Small rural communities are concerned at the loss of long-standing farming families and their replacement by corporate farms run by managers from out of town.

At the small farming hamlet of Clareville in the Wairarapa, one dairying couple lamented that fewer and fewer people attended the annual barn dance each year - that hired managers "don't have the emotional attachment" to the area.