2025 in Review: What Kind of Year Was It For New Zealand Farming

Written By Yuri Abramson

1. Technology on farm in 2025

What arrived and actually got used

Across the country you could see three clear tech trends on farm this year:

  • Automation on the dairy platform
    Robotic and rotary milking systems with individual cow recognition and health monitoring are now running on dozens of farms, feeding rich production and health data straight into farm management tools. NSP Insights

  • Sensors, drones and precision gear
    Farmers are using more IoT soil moisture probes, weather stations, GPS guidance and variable rate application, plus drones for crop health checks and pasture assessment. These tools are now described as central to “modern farming” in New Zealand, not just experimental toys. New Zealand Learning Online

  • Data platforms and AI decision support
    Farm management software is pulling together milk, feed, pasture, sensor and financial information into one place. Across New Zealand businesses in general, AI adoption reached a tipping point in 2025, improving workflows and decision making, and agriculture is very much part of that wave. IT Solutions and Managed Services+1

Technology: what went well

  • Better use of labour
    Automation on dairy sheds, auto drafting and remote monitoring of water and soil helped reduce time on repetitive checks and improved roster flexibility.

  • More data for compliance and funding
    Good records from sensors and platforms made it easier to satisfy banks, auditors and regulators, especially around water use and environmental plans.

  • Early adopters seeing clear returns
    Case studies shared at agritech events in 2025 showed measurable gains in yield, reduced inputs and smoother compliance for farms that fully integrated tech into day to day decisions. Thriving Southland+1

Technology: the hard bits

  • Integration, not gadgets, is the real challenge
    Many farmers reported they now own “lots of bits of tech” that do not talk to each other neatly. Moving from separate apps and dashboards to a simple, farmer friendly view is still work in progress. AgriTech New Zealand

  • Connectivity gaps remain
    Patchy rural connectivity still limits real time data from some paddocks and hill blocks.

  • Cost and confidence
    Capital outlay is significant and margins only recently improved, so plenty of farms are still in the “wait and see” camp, especially where the return on investment is not crystal clear.

2. Money matters: financial picture for 2025

Big numbers

  • Food and fibre exports climbed again
    Export revenue for the food and fibre sector for the year ending June 2025 is expected at about 59.9 billion dollars, up 12 percent on the previous year. Looking to 2025 to 2026, revenue is forecast to reach around 61.4 billion dollars. RNZ+1

  • Dairy still carries a huge share
    Dairy alone contributed about 27 billion dollars in export earnings in the year to June 2025 and rising dairy farm values indicate renewed confidence after a couple of softer seasons. Colliers NZ

  • On farm inflation finally eased
    For sheep and beef farms, input prices fell by about 0.6 percent between March 2024 and March 2025, after a 30 percent rise since 2020. Interest costs dropped by nearly 14 percent; a rare bit of welcome deflation in farm costs. Beef + Lamb New Zealand

  • The “trifecta” for 2025
    Analysts described a combination of relatively high product prices, a weaker New Zealand dollar and solid production as a positive trifecta for the sector during spring 2025. ANZ New Zealand

Financials: positives

  • Better cash flow than in 2023 and 2024
    Higher export prices plus easing interest costs took some pressure off overdrafts and term debt for many farmers.

  • Government funding signalled stability
    Budget 2025 confirmed about 4.95 billion dollars of baseline funding over four years for MPI to support farmers, growers, fishers and foresters, with more than 1.1 billion dollars of appropriations in 2025 to 2026 for agriculture, biosecurity, fisheries and food safety. NZ 2025 Budget+3The Beehive+3NZ 2025 Budget+3

  • Banks remain engaged in the sector
    Reports from rural property specialists show active lending and rising dairy land values, a sign of long term belief in New Zealand agriculture. Colliers NZ+1

Financials: ongoing pressure

  • Margin squeeze is not over
    Even with lower input inflation, total farm costs remain high after several years of steep rises in fertiliser, freight, wages and compliance. Many farms are still repairing balance sheets. Beef + Lamb New Zealand

  • Volatility is here to stay
    Global trade tensions, shifting tariff settings and fragile demand in some markets keep a lid on confidence, especially for arable and some niche exports where contracts are less secure. MPI+1

  • Support is still relatively low by global standards
    OECD analysis shows support to New Zealand agricultural producers remains among the lowest in the OECD at about 1.2 percent of gross farm receipts, far below the OECD average, which means Kiwi farmers ride more of the market ups and downs than many offshore competitors. OECD

3. New rules: freshwater, climate and compliance in 2025

Regulation remained a big part of farming life this year, however there were some shifts intended to make rules more workable.

Freshwater farm plans

  • The rollout of freshwater farm plans was paused while the government reviewed the system and thresholds. MPI+1

  • In August 2025, changes under the Resource Management (Consenting and Other System Changes) Amendment Act were confirmed. These changes:

    • adjust which farms need a freshwater farm plan

    • clarify who must have their plans certified

    • create more room for industry organisations to deliver assurance services for their members. Ministry for the Environment+2The Beehive+2

Greenhouse gas and climate policy

  • Policy settings still expect a system for farm level accounting and reporting of agricultural greenhouse gas emissions, with reporting on 2024 emissions at farm level required from 1 January 2025. Tompkins Wake+1

  • Exactly how pricing will work is still under review, however the direction of travel remains clear: more measurement, more reporting and stronger expectations around emission reductions over time. DairyNZ

New rules: benefits

  • Simpler, more practical freshwater framework
    The 2025 changes aim to make freshwater farm plans more targeted and to reduce duplication with other programmes. Many farmers welcomed clearer thresholds and the greater use of industry assurance models. The Beehive+1

  • Better alignment between tech and compliance
    As rules lean on evidence, tools like soil moisture probes, water meter loggers and detailed farm management software move from “nice to have” to “compliance backbone,” which also strengthens the business case for adopting them.

  • Budget signals support, not punishment
    Government messaging in 2025 repeatedly framed farmers as key to economic recovery and climate action, with Budget 2025 marketed as “backing farmers” through investment in innovation, biosecurity and rural services. Facebook+1

New rules: frustrations

  • Complexity and moving goal posts
    Pauses, amendments and new guidance documents mean many farmers feel like they are aiming at a target that keeps shifting. Planning long term investments around unclear rules is still hard.

  • Admin load
    Even with improvements, the time required to collect data, fill in forms and stay across updates continues to weigh heavily on smaller family operations that lack in house admin capability.

  • Gap between policy and paddock reality
    Some environmental expectations still feel designed with average farms in mind, not the huge range of soils, climates and business models across the country.

What this all means for Kiwi farmers in 2026

If you zoom out, 2025 delivered:

  • A stronger revenue base
    Export numbers and commodity prices improved, giving many businesses breathing space after two tough years.

  • A clear message on tech
    Digital tools, sensors, automation and AI are no longer optional experiments. They are becoming the main way to handle labour shortages, compliance and fine margin management.

  • Rules that still bite, but are slowly becoming more workable
    Freshwater and climate frameworks are evolving toward more targeted, evidence based approaches. That creates opportunities for farmers who treat data, planning and technology as part of the same toolkit.

Practical takeaways

For a typical New Zealand farm, the smart moves going into 2026 look like:

  • Use the better financial conditions to reduce the most expensive debt and to fund one or two high impact technology upgrades, not a whole wish list.

  • Align every tech purchase with a specific problem: labour, water, pasture quality, compliance or animal monitoring, and insist on simple dashboards and good support.

  • Treat freshwater plans and emissions reporting as an opportunity to tidy data and systems now, so you are ready when rules tighten further.


Sources

Yuri Abramson
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