Farms & Farm Machinery #397

INDUSTRY NEWS
confidence remains high
A survey of Australian
farmers shows a collective
optimism across the
industry, with favourable
dispositions seen in all
agricultural sectors
Above: Rabobank’s survey shows
that 39 per cent of farmers expect
conditions in the industry to improve
Australian grain growers
delivered a record wheat
harvest and near-record
total winter grain harvest
last season.
The survey, conducted by Rabobank, indicates the confidence
of Australian farmers remains at historically-high levels
despite the wide-reaching implications of the COVID-19
pandemic.
Such a positive outlook within the farming fraternity follows
a near-record winter harvest and ideal growing conditions,
notably in the country’s eastern growing fields.
While general optimism has eased slightly from a more positive
December outlook, farmers are overwhelmingly confident, with
39 per cent expecting conditions in the agricultural economy to
improve in the next year.
Over half of farmers (51 per cent) expect the conditions to
remain stable, while just seven per cent have a pessimistic
outlook on the year ahead.
Much of the confidence held by those within the agricultural
industry points toward their collective ability to respond from
last year’s drought-affected harvests, according to Rabobank
Australia CEO, Peter Knoblanche.
“The recovery from drought and the return to production
over the past 12 months has been extraordinary, despite the
uncertainties around COVID-19,” says Knoblanche.
“Australian grain growers delivered a record wheat harvest and
near-record total winter grain harvest last season and there are
promising early signs as farmers start making plans to plant this
year’s crop.
“Livestock prices are breaking all sorts of records because the
demand for sheep and cattle is so strong and there just aren’t
the numbers to meet that demand. That is proving a challenge
to those farmers trying to rebuild herd and flock numbers after
the drought but providing good returns for farmers who held
onto stock through the dry years.
“This year it seems all the fundamentals are lining up.
We’ve had near-perfect seasonal conditions over summer
for much of the country and commodity prices are very
solid. Combined with low interest-rates and a number of
government incentives, farmers are generally speaking in a
good place right now.”
Due to the favourable seasonal conditions and
high-yield harvests, the March quarter survey result
has one of the top 10 confidence levels in the survey’s
20-year history.
As a result, agricultural business conditions continue
to climb with the farm viability index, which measures
farmers’ assessments of their own viability, now reaching
a new record; having eclipsed the existing benchmark set
last quarter.
Uncertainty caused by COVID-19 is not seen as a significant
barrier among farmers, with only 10 per cent of farmers
who expected regression in conditions citing the pandemic
as a reason.
Instead, the survey reflects an overwhelming sense of
resilience from farmers, with industry at large remaining
relatively unscathed economically, notwithstanding the
challenges faced in the horticulture and wool sectors.
Other results of the survey showed 68 per cent of
farmers anticipated conditions to keep on improving (up
from 54 per cent) and a prevalent optimism in sectors such
as grain and cotton.
From an economic standpoint, the survey held a similar
level of belief with 41 per cent of farmers expecting an
increase in gross-farm income in the year ahead, including
New South Wales – the state most anticipating higher returns
– while those in the cotton sector also felt they would also
fare well financially.
This anticipated injection of income will likely have flow-on
effects too, with the increase in income enabling farmers to
invest in their farms over the next year. In fact, 36 per cent
of farmers were planning on investing money back into their
business through things such as infrastructure (65 per cent),
machinery and equipment (46) and property (26).
24 TradeFarmMachinery.com.au THE TRACTOR YOU WANT IS NOW EASIER TO FIND