The latest monitoring report from the Ministry of Agriculture and Forestry shows New Zealand growers are showing resilience and flexibility, despite challenging economic conditions.
The ministry's annual horticulture and arable monitoring report suggests that despite increasing costs, many growers had improved financial results for the 2008 harvest season.
MAF's Deputy Director for General Policy, Paul Stocks, says growers have responded well to some tough economic challenges.
But he says while the majority of fruit and arable growers saw their income improve, most vegetable crops were worse off due to increasing costs that could not be matched by an increase in yields or prices.
The ministry says a decline in world cereal stocks and the expansion of the dairy sector in New Zealand are also providing opprtunities for vegetable and arable growers.
Higher returns forecast
The report forecasts a further increase of 20% in returns to cropping farmers this season.
MAF Senior Policy analyst Murray Doak says it also predicts a 23% increase in farm working expenses, which he says is probably a conservative estimate.
However, Federated Farmers grain and seed chair Ian Morten, says MAF is underestimating the input costs to farmers, and he describes the forecast price increase as optimistic.