Prices of New Zealand farmland climbed 0.9% for the period between April and June selling for an average US$23,130 per hectare. The increase indicates a rebound for the country’s critical dairy sector and a recovery from the 0.5% decline in prices for the period between March and May. Dairy farms in the April through June quarter sold for an average US$29,150 per hectare – an increase of 5.2% compared to the previous quarter between March and May. Although positive, these figures come during New Zealand’s slow sales season over the winter and farmers and market observers are waiting to see how external factors will affect sales once the active sales season begins in full force. Fonterra, the world’s biggest dairy exporter has warned dairy farmers of milk solid prices decreasing from NZ$8.40 per kilogram to NZ$7 per kilogram and possibly even further to between NZ$6 – $6.25 per kilogram. New Zealand’s central bank has announced that it expects to raise interest rates for a fourth time to 3.5%, and the New Zealand dollar has strengthened against the U.S. dollar by 6% so far this year.
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