There's been a further slump in farmer confidence, a week after business confidence hit its lowest level in three years.
Federated Farmers says its July survey moved further into negative territory with pessimists overwhelmingly outnumbering optimists.
"World dairy prices are in the doldrums and the forecast is looking more and more challenging," the federation said today.
"Most dairy farmers expect their profitability to worsen... farmers on the east coast of the South Island have experienced a drought and sheep and beef farmers have sent stock to slaughter early."
The survey showed more farmers expect to increase their debt than reduce it.
It says the 12.5 percent drop in the value of the dollar is a silver lining, and should be a buffer against weak world prices.
On July 7 the NZIER's business confidence survey slumped to its lowest level in three years as companies became pessimistic about profitability expectations.