Bayleys news & articles

Land use options in South Island open up.

Tags: Rural Rural Insight

Farmer and investor interest in land on both Canterbury Plains and hill country is shifting beyond traditional pastoral uses as new water schemes start to be commissioned, and farmers look to diversify on their traditional pastoral income sources.

Meantime in Southland that region’s expansive pastoral potential is providing more options to northern farmers seeking succession pathways, and new land use opportunities for existing farmers.

Bayleys Canterbury rural agent Ben Turner said he has noticed a lift in interest among potential buyers considering alternative land uses for properties within the Central Plains Water scheme’s 20,000ha catchment.

“There has been a noticed a lift in interest among potential buyers considering alternative land uses for properties within the Central Plains Water scheme’s 20,000ha catchment.”

This area is in addition to the 24,000ha already covered under Stage 1 of the scheme. Stage 2 was commissioned earlier this year, and includes 180km of piping being laid underground.

“We are seeing more farmers out there who while not being 100% certain what they will use this water for, know they have a number of appealing options including small seed production, market gardening vegetable crops, and arable. It’s also quite likely there are a number of enterprises we have not even seen before that could be up for consideration.”

Increased pressure on market garden land further north has seen a lift in enquiry in Canterbury in better soil areas.

He recently negotiated the sale of an 80ha dairy run-off near Darfield on quality silt soil that sold for about $40,000 a hectare for market garden use.

“That buyer saw the ability of that land for growing given its proximity to Christchurch and the fact it is now covered by the Central Plains Scheme.”

Turner said the environmental standard required by the schemes to gain consent was also accompanied by a corresponding reduction in the demands placed on Canterbury’s valuable underground aquifers.

Stage 1 alone reduced aquifer draw down by 75%, and stage 2 is expected to achieve similar results.

Potatoes NZ director and Canterbury grower David Redmond said demand for cropping land for potatoes is also proving reliable and consistent as growers seek new land to rotate potatoes through.

“This works well for many farmers too who may also be looking for a break crop between cereals or their usual crops. It is a good return to a land owner who does not have to pay for the crop or harvest it, and gets a guaranteed income for the year’s use.”

Meantime further back in the hill country properties that may be suitable for deer farming are getting plenty of lowland farmer interest.

DeerNZ project manager and deer farmer Lorna Humm said anecdotally deer units were being snapped up, with farmers buying back country sheep and beef blocks installing deer fencing and trying to get them stocked.

“This is brilliant for the industry which needs more new farmers on board and more area committed to deer. But the challenge is often the shortage of stock.”

The industry now has half the breeding hinds it had 10 years ago and the present 300,000 were unlikely to lift to over 400,000 for at least another year.

Properties that may have once had deer on them, then shifted to dairy support are now looking appealing for a re-entry to the deer sector with their facilities in place.

Lorna Humm said other challenges include getting staff who are capable of handling deer, a species “quite different” from traditional sheep and cattle to manage. “And if you were a fencer, there is a real need there for skilled deer fencers through the region.”

With deer returns topping $9/kg, farmers were starting to give the traditional “third” species after cattle and sheep a serious look.

She said the relatively light environmental foot print of deer on hill country also means farmers are interested in the stock class as regional council environmental demands tighten.

In Southland Bayleys agent Hayden McCallum said high land prices in the North Island are creating interest among farmers there about what their dollar can buy in Southland.

“For some they may get twice the land they have had up north for the same money, and it gives them options for farm succession pathways for the next generation of the farming family.”

And the land use options in Southland now include more than the traditional pastoral options, for those located in the right areas.

“Land use options in Southland now include more than the traditional pastoral options, for those located in the right areas.”

This includes leasing land to tulip growers. The Dutch flower has been part of the Southland economy for many years, growing well on the deep silt loams of Edendale district, with sales of suitable land making $40,000 to $50,000 a hectare in the past 12 months.

“Often the next alternative land use can be for vegetable growing which is usually in a similar part of the region.”

The region has also seen investment into sheep milking in recent years, and while there has been interest in how the venture unfolds, investors and farmers remain watchful until they have a clearer idea of how the market for the land use’s product develops.

“Overall Southland holds its appeal as farmers face more challenging climatic issues, as a region with reliable rainfall and therefore free water, and well priced land that offers good scale for those seeking it.”

Download PDF   

Related articles