New Zealand’s new prime minister Jacinda Ardern could set out serious challenges for farmers in the country.

Ardern has been voted new leader of the Labour party, which will lead the new coalition government.

The Labour party has plans to introduce a water tax or water quotas in New Zealand, which could prove to be a massive issue for dairy farmers in particular.

A combination of nutrient budgeting and water use taxes...could cost farmers €90 per cow.

Some New Zealand analysts have suggested that a proposed combination of nutrient budgeting and water use taxes for Canterbury dairy farms could cost farmers between €240/ha or €90/cow.

The Canterbury region is part of New Zealand’s South Island and is home to over 1m dairy cows and more than 20% of New Zealand’s national dairy herd.

In the mainland it has dry, sandy type soils that require irrigation from local rivers.

Jacinda Ardern

Read more about the background to the water challenge in New Zealand.

“We congratulate new Prime Minister Jacinda Ardern and the coalition partners on finding a consensus to lead the country,” said Katie Milne, Federated Farmers' national president.

“Federated Farmers is looking forward to getting around the table and talking about the issues which affect our members and farmers.

"The primary sector is the backbone of the New Zealand economy so we anticipate the new government will be mindful of that when formulating policy.”

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