Spring rain boosts Waikato dairy farmers’ spirits despite rising costs

Federated Farmers’ Waikato Dairy Section chair Matthew Zonderop says dairy operations across the country are navigating financial tightropes.

While many town dwellers may groan, about spring rain, farmers across Waikato see it as a stroke of luck.

Federated Farmers’ Waikato dairy section chairman Matthew Zonderop said the region had enjoyed nearly perfect conditions this season, with regular rain and cooler nights driving strong grass growth.

The boost in milk production had put a “spring in the step” of farmers, though Zonderop acknowledged farming remained a balancing act.

“Rising costs, high interest rates, and careful pasture management are daily realities for New Zealand dairy farmers.”

Zonderop, who also chairs the Matamata branch of Federated Farmers, sharemilks at Te Poi on a 140-hectare property running 370 cows.

Even with Fonterra’s forecasted $9.50 payout, dairy operations nationally were navigating financial tightropes, he said.

Planning is essential to keep costs manageable.

Zonderop said data on long-term weather, grass growth rates, and precision fertiliser application guided decisions, ensuring every dollar spent supported productivity.

Prepping and balance

“Farmers are looking ahead, prepping winter feed and balancing fertiliser applications, knowing that well-maintained pastures will be vital through summer and into the next season.”

Alongside the traditional cycle of hay baling and silage making, New Zealand’s dairy farmers saw more feed pads and herd homes integrated into farm management, Zonderop said.

While feed pads provide the benefits of increased milk production, lower labour needs, and reduced pasture wear, they are significant investments and require careful oversight.

“These new structures come with benefits and costs, yet they represent a shift toward diversifying how farms operate to meet production demands and weather uncertainties.”

Succession challenge

He also believes the path to farm ownership is becoming more difficult for the next generation.

“Moving from a farm assistant to a sharemilker and then to a farm owner is no easy feat, especially when land and stock prices continue to rise.”

Zonderop said this had become a “generational problem”.

“Young people entering the industry as farm assistants may only achieve sharemilker status by their 30s, with ownership a distant hope by 50 …if at all.”

He said dairy land prices in the Waikato often exceeded $100,000 a hectare, and with dairy cows priced at up to $3000 a head, the financial barriers to ownership were steep.

Add in the rising costs of electricity, irrigation, compliance with environmental standards, and maintenance, and it’s no wonder that many would-be farmers face a daunting future.

Matthew Zonderop believes farm ownership is becoming more difficult for the next generation.

Zonderop said for some, the challenges were so great they considered leaving dairy for other careers, feeling ownership was simply out of reach.

However, he said there was hope for tomorrow’s dairy farmers if the current generation was willing to play their part.

Established farmers have an essential role in mentoring, supporting, and opening doors for new entrants.

Zonderop said this wasn’t just about handing down knowledge; it was about actively “passing the baton” to ensure that young people today had a real chance at owning farms tomorrow.

“The experience and insights of seasoned farmers are invaluable to newcomers navigating the complexities of modern dairy farming.”

Realistic pathway

Options such as lease-to-buy arrangements could provide a realistic pathway to ownership, helping future farmers establish a foothold in the industry without the immediate financial strain of full ownership, he said.

“Farm owners can play a part by reflecting on their own journeys and asking how they can help others succeed.

“Supporting younger farmers in practical ways can make a lasting difference, not just for individuals but for the entire dairy industry.”

Corporate and large-scale ownership had also become more common in New Zealand, with “big players” buying up land, often relying less on sharemilkers and more on direct employees.

This trend, while beneficial for expansion, can limit opportunities for those who hope to work toward owning their own farms.

Zonderop said the involvement of corporates meant fewer entry points for the next generation, making it more challenging for individuals to build equity and work toward ownership.

“Mentoring and structured ownership paths could counterbalance this trend by providing alternative ways to build equity and take ownership of farming careers.”

He said the importance of supporting new entrants went beyond the immediate challenges of ownership and finance.

Continuing traditions

For many established farmers, farming is not just a job but a way of life that they want to see carried forward.

New Zealand’s dairy industry had long been the backbone of rural communities and a source of pride and productivity on a global scale, he said.

“Ensuring that this legacy continues means investing in people just as much as in pasture.”

This wasn’t just about the present.

“It’s about preserving a way of life and building an industry where future generations of farmers can continue to succeed.

“By working together and fostering a spirit of mentorship, today’s farm owners can be instrumental in shaping a future where New Zealand’s dairy legacy continues to flourish.”