2 Sector Analysis
The sector analysis has been carried out in the same way as the analysis in the previous section except it has been done based on the three nominated farming systems—arable, livestock and dairy—rather than the four geographic sectors.
2.1 Summary Tables
Summary data is reported in a similar fashion as the previous sector with analysis being done on farm working expenses, capital, personal and then total.
Table 1: Farm Working Expenses
| Out | ChCh | Ash/Tim | Small | Total | ||
| Arable | 55.45 | 104.70 | 299.45 | 267.19 | 726.79 | |
| $/ha | Livestock | 18.18 | 43.44 | 95.21 | 104.69 | 261.52 |
| Dairy | 35.31 | 320.37 | 1119.35 | 574.10 | 2049.13 | |
| Arable | 8% |
14% |
41% |
37% |
||
| % | Livestock | 7% |
17% |
36% |
40% |
|
| Dairy | 2% |
16% |
55% |
28% |
Points to note from Table 1 are:
- Dairy farming has by far the largest farm working expenses per hectare with arable being 2.5 times livestock.
- Arable and livestock farmers have very similar expenditure patterns in percentage terms with approximately 75 percent of their expenditure occurring in small towns or Ashburton or Timaru. Dairy farms have a different expenditure pattern with a smaller portion of expenditure occurring in small towns (28 percent).
- However, the impact of the large amount of total expenditure means that dairy farms put twice as much money through the economy of small towns as arable farms who themselves put 2.5 times the amount of income through small towns as livestock properties. This has a potentially huge impact on the economies of small rural areas with the continued expansion of conversion of dryland sheep and beef properties into dairy farms.
- The big winners from dairy farm expenditure are the medium-sized cities of Ashburton and Timaru with 55 percent of the expenditure going through them or $1,120 per hectare.
Table 2: Capital
| Out | ChCh | Ash/Tim | Small | Total | ||
| Arable | 2.81 | 23.23 | 69.68 | 34.65 | 130.37 | |
| $/ha | Livestock | 0.10 | 7.64 | 20.94 | 3.88 | 32.57 |
| Dairy | 1.97 | 12.26 | 100.16 | 25.71 | 140.10 | |
| Arable | 2% |
18% |
53% |
27% |
||
| % | Livestock | 0% |
23% |
64% |
12% |
|
| Dairy | 1% |
9% |
71% |
18% |
Points to note from Table 2 are:
- Dairy farmers and arable farmers appear to have similar capital expenditure levels. However, dairy farmers spend a greater proportion of it in the local area than arable farmers do.
Table 3: Personal
| Out | ChCh | Ash/Tim | Small | Total | ||
| Arable | 3.42 | 41.81 | 45.59 | 17.80 | 108.61 | |
| $/ha | Livestock | 1.27 | 15.30 | 16.74 | 6.58 | 39.89 |
| Dairy | 7.10 | 84.46 | 92.61 | 36.55 | 220.72 | |
| Arable | 3% |
38% |
42% |
17% |
||
| % | Livestock | 3% |
38% |
42% |
17% |
|
| Dairy | 3% |
38% |
42% |
17% |
Points to note from Table 3 are:
- Dairy farmers have significantly higher personal drawings per hectare than arable farmers who in turn are significantly higher than livestock farmers do. Although this has a large influence of size of property in it, further analysis of the figures shows that drawing levels in dairying and arable farms are significantly higher on a per-farm basis than sheep and beef properties. This is a reflection of the relative profitability of the industries at the point of the survey.
- Although the expenditure pattern figures are standardised as a result of the collection method, it still indicates that dairy and arable properties are putting much larger amounts of money per hectare through the small towns than traditional livestock farming.
Table 4: Total
| Out | ChCh | Ash/Tim | Small | Total | ||
| Arable | 61.68 | 169.74 | 414.72 | 319.64 | 965.78 | |
| $/ha | Livestock | 19.56 | 66.38 | 132.89 | 115.15 | 333.98 |
| Dairy | 44.38 | 417.09 | 1312.12 | 636.36 | 2409.94 | |
| Arable | 6% |
18% |
43% |
33% |
||
| % | Livestock | 6% |
20% |
40% |
34% |
|
| Dairy | 2% |
17% |
54% |
26% |
Table 4 bears out the important issues identified in the previous expenditure tables in that although dairy farmers have different expenditure patterns than the other farming sectors, they still have a huge throughput in the local economy. Dairy farm expenditure tends to be concentrated in percentage terms through the cities. However, they are still spending twice as much through small towns as their arable counterparts, and three times the amount as their arable counterparts through the medium-sized cities of Ashburton and Timaru.
2.2 Detailed Results
The detailed analysis of expenditure by the three farming sectors by individual items is contained in Tables A6, 7 and 8 held in the Appendix.
Contact for Enquiries
Rural Affairs Coordinator
Sector Performance Policy
MAF Policy
Ministry of Agriculture and Forestry
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0675
Fax: +64 4 4 894 0745
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