Pāmu Landcorp is forecasting an uplift in its net operating profit for the financial year ending June 30, 2026. Photo / NZME
Pāmu Landcorp chief executive Mark Leslie is admitting conversations around the future of State-Owned Enterprises are “front of mind” for the farming agency.
In an interview with Newstalk ZB, Leslie spoke about how the business has been on a turnaround plan, and continues to aim for improved financial performance. The Pāmu boss has also spoken candidly about questions around its future.
“We’re pretty clear around the number one priority is the performance piece. That’s what we’ve been focused on. Equally, we understand the views of the owner in terms of the Crown – they would like to release some capital.”
The Act Party has suggested some state-owned farms should be considered for sale or privatisation, with MP Mark Cameron calling the idea a “no-brainer”.
Pāmu, formerly Landcorp Farming, manages around 360,000ha of land across more than 100 farms in the country, including on some land owned by the Department of Conservation.
Prime Minister Christopher Luxon has ruled out asset sales this term.
The PM has recently reiterated calls for a “bigger, bolder, braver” conversation about asset recycling, in which assets could be sold with proceeds used elsewhere.
Leslie noted Pāmu was looking at options around its future, but noted it could come with complexities around leases, farms subject to Treaty settlements, and those with first right of refusal to iwi.
“The last thing we also want to leave is a business that has sold some assets and is now unable to fund itself.
“One thing Pāmu’s always been very proud of is that we haven’t had to go and seek funding from the Government. We don’t want this business to get into that position either.”
The Pāmu boss added significant changes had been made at a farm level, and says the agency has “really thought about how we actually drive that performance right across the whole network of farms” and potential integration to maximise returns from both dairy and livestock.
The discussion also came up during Parliament’s scrutiny week, where chair John Rae told MPs “we totally respect the Crown has the right to make a decision around ownership, or change of ownership”.
“Our job is to give the best sense of what that would look like, preserve the value that we believe that Pāmu brings to the farming system and we continue to prosecute that, and make sure that we fully understand what we might be giving away at the first instance, if we were not able to retain this asset in the way it is.”
Rae also told the select committee hearing that the agency spends time mulling what it would do if farms went “out of our system and into alternative ownership”.
In November, Pāmu announced its updated forecast for a net operating profit for the financial year ending June 30, 2026 was being revised to between $80-90 million, up from August forecasts.
The prediction is also well above the target of $61.3m in the agency’s statement of corporate intent.
It follows a letter of expectations sent to State-Owned Enterprises (SOEs), which urged it to manage farms as efficiently as those owned by non-Crown organisations, and to demonstrate efficiency, as well as reducing corporate overhead spending.
A July Treasury report on Pāmu Landcorp’s statement of corporate intent and business plan, obtained by Newstalk ZB under the Official Information Act, stated there was an expectation to improve performance and deliver returns.
It noted the prior forecast for net operating profits, which at the time was $61.3m in the 2026 financial year, with an assumed 2% increase in commodity prices over the next decade. Officials stated they were “concerned this growth is optimistic given the volatility in markets”.
Pāmu‘s most recent forecasts show a greater net operating profit than the initial predictions which Treasury referred to.
At the time, it predicted dividends of $15m, $10m and another $10m from the 2026-2028 financial years, with total shareholder return set to increase.
On the dividends, Leslie told Newstalk ZB recent severe weather the lower South Island faced probably cost an estimated $14-15m, meaning Pāmu had to be sure the dividend was at a level that could allow them to have a sustainable balance sheet.
The July report also stated small farms had been identified for sale, and that the SOE would consider “opportunities to divest further underperforming and isolated farms”.
In the interview, Leslie added he will continue driving commercial performance in 2026.
He also acknowledged the SOE’s workforce, saying they’ve asked a lot and made a lot of changes, but people had really stepped into that and delivered “some amazing results on-farm”.
Azaria Howell is a multimedia reporter working from Parliament’s press gallery. She joined NZME in 2022 and became a Newstalk ZB political reporter in late 2024, with a keen interest in public service agency reform and government spending.