Resilience and finances on Aotearoa New Zealand farms: Evidence from a random survey on the sources and uses of debt

Greig, B. J. W.; Nuthall, Peter L.; Old, Kevin

doi:10.1111/nzg.12207

Cited by 8 publications

(15 citation statements)

References 73 publications

(76 reference statements)

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“…It was expected that those farmers who received credit would help to invest in the dairy sector. Debt helps dairy farms relax capital constraints and can smooth the flow of income during difficult years [38,39]. However, the result suggests that dairy farms with higher debt incur higher costs, which reduce their technical efficiency.…”

Section: Resultsmentioning

confidence: 99%

The Role of Technical Efficiency Achieving Sustainable Development: A Dynamic Analysis of Norwegian Dairy Farms

Alem

2021

Sustainability

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Growing environmental concerns have prompted governments to make sustainable choices in agricultural resource use. Evaluating the sustainability of agricultural systems is a key issue for the implementation of policies and practices aimed at revealing sustainability. This study aimed to evaluate the performance of Norwegian dairy farms, accounting for marginal effects of environmental (exogenous) variables. We adopted the dynamic parametric approach within the input distance function framework to estimate the performance of Norwegian dairy farms, focusing on the technical efficiency and determinates. For comparison, we also estimated the static parametric model, which was used by previous studies. We used unbalanced farm-level panel data for the period 2000–2018. The result shows a mean technical efficiency score of 0.92 for the dynamic model and 0.87 for the static models. The empirical result shows that the previous studies that focused on the static model reported a biased result on the performance of dairy farms. The dynamic efficiency score suggests that Norwegian dairy farms can reduce the input requirement of producing the average output by 8% if the operation becomes technically efficient. The environmental variables have a different effect on the performance of the farmers; thus, policymakers need to place special focus on these variables for the sustainable development of the dairy sector.

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Section: Resultsmentioning

confidence: 99%

The Role of Technical Efficiency Achieving Sustainable Development: A Dynamic Analysis of Norwegian Dairy Farms

Alem

2021

Sustainability

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“…In recent years, dairy sector indebtedness has increased in many dairy-producing countries such as New Zealand (Greig et al, 2019). Several factors may contribute to the growth of debt, including motivations to increase farm size and farm investments, changes in milk payment methods, access to irrigation, and movement from low-intensive to high-intensive farming systems that require greater use of purchased inputs such as supplementary feed (Mounsey, 2015;DairyNZ, 2017;Greig et al, 2019;Ma et al, 2020). In New Zealand, the level of debt has raised concerns over the resilience of the dairy sector, particularly the ability of highly indebted farms to withstand shocks such as sustained falls in commodity milk prices or higher costs.…”

Section: Short Communicationmentioning

confidence: 99%

Short communication: The relationship between farm debt and dairy productivity and profitability in New Zealand

Renwick

Zhou

2020

Journal of Dairy Science

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For a variety of reasons, dairy sector indebtedness has increased in recent years. However, it is not clear whether increased debt boosts or damages the economic performance of dairy farms. This paper provides empirical evidence by exploring the effects of farm debt measured by debt-to-asset ratio on dairy productivity and profitability, using the New Zealand DairyBase data of 2,637 dairy farms for a 10-yr period 2005 to 2014. A fixed-effects panel data model is utilized for the empirical analysis. The findings show that farm debt is significantly and negatively associated with both dairy productivity and profitability. We find that dairy productivity is positively determined by production intensification, irrigation intensity, milking frequency, cattle breeds and stocking rate, whereas dairy profitability is positively affected by milk price, business type, milking frequency, and stocking rate. Further analyses reveal that the debt ratio significantly decreases both the technical efficiency of dairy farms and return on assets; a high debt ratio increased dairy productivity between 2005 and 2009, whereas it decreased dairy productivity between 2011 and 2014; the effects of the debt ratio on dairy profitability vary over time. The analysis for a 10-yr balanced panel data (250 farms) shows that debt ratio does not significantly affect both dairy productivity and profitability, which suggests that the presence of farm-specific attributes such as farm life cycle and managerial ability of dairy farmers may also affect the debt ratio and through this farm performance.

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“…Communities dependent on business for sheep farms are declining (primarily) due to negative net migration. The reasons for this are not part of this research but are linked to corporatization and the mechanisation of farms (Greig, Nuthall, & Old, ). The results show that low producing land‐use, which includes both sheep farming and forestry, also has a negative influence on net migration.…”

Section: The Contribution Of Net Migration By Agementioning

confidence: 99%

A new look at population change and regional development in Aotearoa New Zealand

Brabyn

Jackson

2019

N Z Geog

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In New Zealand, population change is interlinked with regional development. Places growing in population attract regional investment, while regional investment-or lack thereof-can change migration patterns. However, to determine the appropriate response to population change for a community, it is important to understand that population change involves much more than "just" migration. Specifically, it involves interactions between the three components of population change: natural change (births minus deaths), net migration (international and internal) and population ageing (changing cohort size). For example, migration can be negative, but growth can be positive due to underlying natural increase or growth in cohort size.Responses need to differ, depending on these drivers. The goal of this article is to provide new insights into these interactions using data for 275 cities, towns and rural centres (hereafter "urban places") in New Zealand for the period 1976 to 2013. The results show that natural change has been consistently positive for most urban places up to the present, although projections indicate that in the future this component will become negative across much of the country. At the same time, net migration shows considerable spatial variation, not only in terms of volume, but also direction (negative or positive), which differs markedly by age. A net gain of people of retirement age can offset a net loss of young adults to deliver overall growth, and vice-versa, but the two have very different implications for longer term growth. An analysis of the drivers of net migration using GIS and machine learning techniques provides an indication of the importance of economic conditions (land-use and access to markets), lifestyle, access to essential services (hospitals and education) and their interaction with age in regional change. The results show that population age is the best predictor of migration. Younger people are moving to cities for tertiary education and work and older people near or in retirement are moving to smaller lifestyle towns but also want to be close to amenities such as hospitals and international airports. The research also shows that natural lifestyle characteristics (landscape and climate), in combination with age are just as important as economic conditions for understanding migration. Regional development, such as infrastructure that helps business (ports and services) is important for the working age population but not

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Resilience and finances on Aotearoa New Zealand farms: Evidence from a random survey on the sources and uses of debt

Cited by 8 publications

References 73 publications

The Role of Technical Efficiency Achieving Sustainable Development: A Dynamic Analysis of Norwegian Dairy Farms

The Role of Technical Efficiency Achieving Sustainable Development: A Dynamic Analysis of Norwegian Dairy Farms

Short communication: The relationship between farm debt and dairy productivity and profitability in New Zealand

A new look at population change and regional development in Aotearoa New Zealand

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