The level of lending to the agriculture sector is still rising, Reserve Bank figures show, despite the recession and the credit squeeze.
Sector credit figures released by the Reserve Bank show lending to the agriculture sector has continued to rise steadily during the past year, reaching more than $44 billion in February.
Although the rate of increase has eased, lending was still more than $160 million above the January total, while lending levels in the business sector have been falling since late last year.
ANZ National managing director of rural banking Charlie Graham says an increasing proportion of the lending is not for expansion or new projects, but to provide farming businesses with liquidity to keep going during a difficult time.
Mr Graham says there has been a steady decline in farm deposit levels in the past six months or so as farmers draw on cash reserves to help fund their operations.
