A sustained lift in global commodity prices has provided a significant boost to New Zealand’s rural economy, lifting farmer confidence to multi-year highs and fuelling a resurgence in the agricultural property market.
The latest data highlights a sharp upswing in export and farmgate earnings, driven by robust performances in the dairy, horticulture, and meat sectors.
According to ANZ, its World Commodity Price Index reached 404.9 in May, surpassed only twice this century.
Adjusted for exchange rates, the index peaked at a record 353.8 in February, with dairy and horticulture prices each rising 29 per cent over the past two years.
Start your property search
Export earnings reflect these gains. Stats NZ reports a 17 per cent increase in the year to March 2025, led by a 10 per cent rise in dairy income and 7.2 per cent in meat exports.
Fonterra has forecast a record Farmgate Milk Price midpoint of $10.00/kgMS for the 2024/25 season, potentially injecting $15 billion into the economy.
Zespri also posted record global sales of $5 billion, with returns to growers exceeding $3 billion for the first time.
Meanwhile, red meat export revenues are forecast to climb by $1.2 billion to $10.2 billion in 2024/25.
Average farm profitability is expected to rise to $106,500, up nearly 90 per cent on the previous season.
This economic upswing has led to a noticeable rebound in farmer sentiment.
Rabobank’s latest quarterly survey recorded the highest level of confidence in more than seven years, while a growing number of farmers now view their operations as “easily viable”.
Confidence in rural land values is also strengthening, with expectations for price increases now outweighing those anticipating declines.
This renewed optimism is flowing into the rural property market. Real Estate Institute of New Zealand data shows a marked recovery in sales volumes and values from the cyclical lows of 2024.
In the year to May 2025, 361 farms were sold, the highest total since June 2022, with dairy-related transactions doubling to $1.66 billion.
Horticultural property sales reached a two-year high of $251.2 million, while livestock farm sales rose 26.4 per cent to $1.37 billion.
Shane O’Brien, Director of Rural & Agribusiness at Colliers Christchurch, says there has been a noticeable uplift in sales activity across a number of sectors.
“Recent government announcements such as the intention to tackle freshwater reforms have given farmers renewed confidence that regulation will be lifted or simplified, which assists in buying decisions,” O’Brien says.
“Falling interest rates and better on-farm product prices have contributed to rising sales volumes in a range of regions across New Zealand.”
Although median land values have yet to show significant growth, O’Brien says the uplift in activity signals further gains may lie ahead, with renewed buyer demand expected to drive price appreciation later this spring and into 2026.
Calling on his 32 years of experience in rural real estate, O’Brien says people who are considering selling or buying a farm need to ensure they conduct their research during such a time of global uncertainty that is being driven by geopolitical tensions and tariffs.
“It is important to get sound advice before contemplating a sale or purchase of rural land. A thorough understanding of the environmental status of the property and its future capabilities or potential to have a land use change means we are working with buyers and sellers who are looking six months or a year ahead.
“With spring approaching, now is the time for prospective sellers to begin the process of getting their property ready for the market.”
- Supplied by Colliers
