From ‘dead horse' to golden child: Why Pāmu is suddenly making millions

The Spinoff

2 days ago

Once under threat of privatisation, the state's largest farmer is now forecasting record profits. But what exactly is Pāmu, and should it still be publicly owned?
Threatened with privatisation at the beginning of the year, the government's largest land manager Pāmu has had a remarkable financial turnaround. Late last week, it was revealed that the entity previously known as Landcorp Holdings was expecting to report a record profit after years of criticism and struggle.
What is Pāmu?
Pāmu is the trading name of Landcorp Farming Limited – the government's largest landholder and farming enterprise. With around 360,000 hectares across 110 farms, it's often called 'the state farmer'.
It manages about 1.3 million livestock (cows, deer, sheep and beef cattle), and employs around 600 permanent staff. Its farms aren't just about meat and milk – Pāmu is also involved in forestry, horticulture and agricultural research and development.
But its roots run deep into colonial New Zealand. Pāmu evolved out of the Department of Lands and Survey, an agency responsible for surveying, leasing and farming land – much of which was confiscated or unjustly acquired from Māori. When the department was broken up in 1987, its commercial farming assets became Landcorp – a state-owned enterprise, with shares held by the minister of finance and minister for SOEs on behalf of the Crown.
What does Pāmu actually do?
Under its mandate as a state-owned enterprise, Pāmu has three core jobs:
Run profitable farming operations
Return land as part of Treaty settlements
Lead innovation in sustainable farming
Lately, its focus has been on research, including efforts to breed low-emissions livestock and improve dairy-beef genetics. It's part business, part science lab, part Treaty partner – which makes it uniquely placed in Aotearoa's economic and cultural landscape.
What about Treaty land returns?
This is where things get murky.
Pāmu is supposed to help facilitate the return of state-owned land through te Tiriti o Waitangi settlements, and while much of the land it owns must be offered to iwi for sale first under the right of first refusal (RFR), in 2024, it was holding just one property (valued at $3m) for potential sale to iwi – down from two the previous year.
Why is Pāmu at threat of being sold off?
At the beginning of 2025, Pāmu found itself in the crosshairs of the Act Party. Act MP and dairy farmer Mark Cameron – who also chairs parliament's Primary Production Committee – said the organisation was a 'no brainer' for privatisation, arguing that its $2.2bn assets were better off in private hands. 'How is it so that the dear old taxpayers are on the hook continually flogging a dead horse and arguably Pāmu has not managed to get on the right side of the fiscal ledger?' he said in January.
Even the prime minister hinted at wider state asset sales. The thinking was simple: if it's not profitable and not serving a clear public purpose, why keep it?
So what happened with the turnaround?
In July 2025, Pāmu announced a forecasted after-tax profit of up to $122m – an increase of around 563% from its $26m loss the year before.
The secret? A few key shifts:
Soaring milk prices: The average farmgate milk price jumped from $7.50 to $10 per kgms (kilogram of milk solids), boosting milk revenue by $24m, up 35%.
Better lamb prices and operational efficiency: gains were made across livestock categories and in management.
Trimming the fat: Pāmu Foods, its experimental consumer brand, was shut down last year.
The company's leadership also changed in August 2024, with experienced director John Rae stepping in as chair and Sarah Paterson joining the board.
So is it safe from privatisation?
It has been pointed out that much of the land managed by Pāmu isn't actually its to sell, as it's leased from private owners or DOC, and much of the land it does own is subject to Treaty settlements, so iwi get RFR.
So privatisation could be tricky, but it doesn't mean it's impossible. While the record profit may take the heat off, Pāmu's long-term future is far from certain. Its 2026 profit is forecast to fall back to between $56m and $66m, with risks from volatile commodity prices, currency shifts, geopolitics and extreme weather.
And political winds can shift fast. For now, Pāmu is riding high – but whether that's enough to silence calls for privatisation, or to improve its record on Treaty land returns, remains to be seen.