1 Introduction
Each year the Ministry of Agriculture and Forestry’s policy unit (MAF Policy) monitors the production and financial status of farms and orchards. The unit also monitors trends, issues, and sector concerns. It uses this information to create models of specific farm and orchard types: for example, South Island merino farms, Waikato/Bay of Plenty dairy farms, or Bay of Plenty kiwifruit orchards.
Such models are the basis of MAF Policy’s Monitoring Report series of short-term financial and physical forecasts for agriculture sectors and regions within New Zealand. The reports reflect growers’ expectations and intentions, as well as the views of those servicing the sector. These forecasts are not MAF price or production predictions: MAF receives the information for the models from contracted sources. MAF’s price and production forecasts are published in the Situation and Outlook for New Zealand Agriculture and Forestry.
This report contains one arable cropping model, and commentaries on fresh and processed vegetables and maize.
How the models were created
The model farm depicted in this report represents an average arable farming operation in Canterbury. The model is created from information drawn from 20 arable farmers and a wide cross section of agribusiness representatives.
The aim of the model is to typify an average arable farm for the region. Budget figures are averaged from the contributing arable farms and adjusted to represent real arable farms. Income figures include off-farm income, new borrowing, and other cash income. Expenditure figures include costs of management, farm production, debt leasing, drawings, and other land development and capital purchases.
Monitoring is continually being improved to meet the needs of the users of the reports. From time to time the models are revisited, and changes may be made. Bear this in mind when making comparisons between years.
Calculations used in the models
The economic farm surplus (EFS) depicted in the model budgets is calculated as follows:
gross farm revenue
less working expenses (excluding interest, rent, and lease costs)
less depreciation
less wages of management (WOM).
Wages of management are calculated as follows:
$31,000 allowance for labour input
plus 1% of total capital as managerial reward.
An upper limit for WOM of $75,000 has been set.
Contact for Enquiries
Farm Monitoring Programme Manager
Monitoring and Evaluation
MAF Policy
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0623
Fax: +64 4 894 0741
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