It's a tough time for dairy farmers with expenses up and profits down. 

An industry survey has shown a suite of challenges for dairy producers including a drop in the payout for milk solids and a reduction in herd size. 

It's caused operating profits to be down 27%. 

Mark Neal, Head of Data Science at Dairy NZ, told Mike Hosking that it's emblematic of wider economic challenges. 

He says farmers, like the rest of New Zealanders, are battling inflation and are being forced to watch costs. 

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