Debt and Risk Management for Farmers
Federated Farmers has reported that farmers are beginning to dip into their overdrafts and loans again as profits are down and costs are rising. The Reserve bank figures show that agricultural sector lending has increased, up $746 million from February last year to February 2023, according to Stuff’s reporting.
Stuff quoted Rabobank NZ chief executive Todd Charteris as saying, “with profit margins likely to remain tight […] business success in 2023 would be possible if farmers focused on reducing business costs.”
Concerns about profitability and morale in the farming sector have also been raised in health and safety reporting - which we summarise here- as fatigue and cost cutting can undermine farmers’ ability to meet health and safety regulations.
It’s not hard to see a connection between debt and health risks as pressure on farmers mounts. The risks posed by overwork and under-resourcing on farms are financial, mental, and physical in nature. It is important to recognise early warning signs and take steps to address them early on.
If you are concerned about your situation, reach out to Rural Accountants to discuss our financial planning and budgeting services. We are experienced in assisting our clients on these matters, especially in preparation for seeking bank loans or financial assistance. Managing these issues in advance with help from an expert team can help to reduce stress and manage potential risks.