Bay incomes rebound

Romneys in Hawke's Bay, where farm incomes are reported to have bounced back last year.

Hawke's Bay farm incomes have bounced back with an average increase of 21 per cent, according to leading rural accounting consultants and providers Crowe Horwath.

As a result, the company suggests farmers in the Bay invest more in assets, with average gross income per hectare rising to $978 in 2014, up from $805 the previous year.

Increasing prices for sheep and beef are encouraging Hawke's Bay farmers to invest more according to the company's 2014 farm benchmarking analysis.

Denis Hames

Price growth has encouraged farmers to invest in livestock, up 31 per cent on average, and plant and vehicles (29.6 per cent), the analysis says. This has lifted long-term debt by about 9 per cent.

Crowe Horwath principal and agri specialist Denis Hames says Hawke's Bay farmers have some confidence in where prices are going.

"The analysis makes it clear that farmers were more inclined in 2014 to invest in increasing levels of plant and equipment and their gross incomes have improved," he says.

"Although not as good as 2012 - the best year we have seen - the results of the benchmarking analysis are encouraging with an upward trend," he says.

He believes it will continue in the current year for cattle.

"But sheep and beef may not be as buoyant," he says.

In summary, Mr Hames says there was a good recovery from the poor 2013 year which has continued this year.

The Crowe Horwath benchmarking analysis enables farmers to monitor their farms' performance over a five-year time period as well as to benchmark themselves against farms of a similar class.

Mr Hames says farmers can highlight areas for potential improvement and areas that they're doing particularly well in. The reports include the new Analysis One tool that enables farmers to more visually compare results with others.