Consolidation is inevitable in the tourism sector as operators face a particularly tough year, a leading industry player says.

Data from Statistics New Zealand shows short-term overseas visitor arrivals for the year ended November were up 2.5% at 2.6 million.

However, InterCity Group chief executive Malcolm Johns said visitor expenditure was a bigger challenge than the number of arrivals.

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Ngai Tahu Tourism has taken a majority stake in a 40-year-old Rotorua farm tourism venture as it seeks to grow its business into the regions of New Zealand that form the main tourism trail for international visitors.

John Thorburn, chief executive of the tourism operating subsidiary of Ngai Tahu, said the company had taken a majority stake in Agrodome, a sheep show-based venture, for an undisclosed sum.

Ngai Tahu has also bought about a 40 per cent stake in the 35-metre working paddle-steamer Lakeland Queen, run by the Agrodome owners on Lake Rotorua.