Pressure on farmers has eased a little on the back of an improved farming outlook according to Federated Farmers' latest banking survey, undertaken by Research First in May.
The survey showed that 8.5 per cent of farmers reported coming under 'undue' pressure from their bank over the previous six months,down from 9.6 per cent in November. Ten per cent of dairy farmers reported undue pressure, down from 12.8 per cent, while sharemilkers fell from 15 per cent to 10 per cent.
The figure for non-dairy farmers (mainly meat and fibre and arable farmers) was 6.9 per cent, down from 8.2 per cent.
Federated Farmers vice-president Andrew Hoggard said the easing could be down to an improved farming outlook on the back of higher commodity prices since the middle of last year, most dramatically for dairy but also for meat.
The average mortgage interest rate for respondents was 5.2 per cent, unchanged from November, while the average overdraft interest rate was 7.3 per cent, down from 7.7 per cent.
More than 80 per cent of respondents were satisfied or very satisfied with their bank relationship, fractionally down from 81.4 per cent. Sharemilkers had the lowest level of satisfaction, at 69.5 per cent, slightly on November. Satisfaction with bank communication also dipped slightly.
For 75.9 per cent it was excellent or good, down from 77.2 per cent. Sharemilkers continued to be least satisfied, at 61 per cent, down from 63 per cent.
Two-thirds of farmers ended the 2016/17 season with a detailed, up-to-date budget for that season, similar to the previous year, while, 39.3 per cent had both the current season budget and 2017/18 covered, again similar to the same time last year.
"Dairy farmers and farmers with mortgages are much more likely to have detailed and up-to-date budgets," Mr Hoggard said.
"This shouldn't be a surprise, given that dairy farmers have significantly higher debt levels than other farmers, making robust budgeting much more pressing."
