Dairy farmers still smarting from dairy co-op Fonterra's plummeting payout forecasts say mounting business costs will be an added burden.
Statistics New Zealand figures reveal the cost of running a farm in the June quarter was 4.5 per cent more than the same time last year, and 1.5 per cent up
on the March quarter.
Dairy farmers finished a bumper season in June, with Fonterra making a record payment of $5.30 a kilogram for milksolids.
But Fonterra predicts that next year's payout will be down to $3.70 - a $130,400 drop in income for the average dairy farmer.
Government statisticians said a 4.4 per cent boost in interest rates was the biggest jump in costs during the June quarter.
Fuel prices also contributed significantly, rising 6.2 per cent, to reflect a lift in world prices.
The livestock purchases index also kept rising: in the June 2002 quarter stock prices rose 1.3 per cent, the 13th consecutive increase for this index.
But over the past couple of seasons the biggest cost rises for dairy farmers came in grain feed and grazing, a 20 per cent increase in each.
- NZPA
