It’s set to be a year broadacre farmers will remember for all the right reasons – their best in two decades, in fact.
An exceptional spring, a bumper grain harvest and soaring livestock prices have pushed Australia’s anticipated average broadacre farm cash income to $216,000 for this financial year.
It is the third consecutive year of significant farm earnings rises, with the latest projections easily topping 2015-16’s record of $182,500 and doubling average incomes of the past decade.
According to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), all states except Tasmania are on track for higher farm receipts after deducting production costs, and even the island state’s earnings will be above average.
ABARES expects Australian farmers will produce a record $63.8b in crops and livestock as a result of the recent big harvest and soaring saleyard prices.
That’s an 8.3 per cent rise on 2015-16’s production value figures.
Despite dismal cereal prices, graingower earnings are driving much of the leap after croppers brought in a record 59 million tonne winter harvest, 30pc bigger than the previous biggest in 2011-12.
Grain farm earnings will average almost $400,000, with the big crop also heavily responsible for a likely $1 billion jump in the value of Australian farm exports to 48.7b for the year.
ABARES economist, Tom Jackson, noted beef prices had nearly doubled in real terms in the past three years to values not seen since before the 1970s cattle market crash, lifting average beef enterprise earnings to about $163,000 in 2016-17.
Strengthening wool prices and surging sheepmeat demand would push sheep producer incomes to average $133,000, up from $105,000/farm last year.
“It’s clear the beef, sheep and cropping sectors have had a very good run in the past few years,” Mr Jackson told this week’s Outlook 17 conference in Canberra.
The extra cash in these three categories was also reflecting in debt repayments, with equity in farm holdings rising for the first time since 2000.
But dairy farm earnings continue to reflect poor global milk prices of the past year, slumping to a national average of $105,000.
Victorian farm incomes have dropped about $30,000 in the past 12 months to just $75,000, despite cheaper fodder and irrigation costs.
“The national dairy average is about 13pc below the past 10 years,” Mr Jackson said.
Meanwhile, average farm costs for the financial year are expected to be up about 7pc, partly as a result of higher prices for replacement store stock and breeders, plus extra fertiliser and crop chemical costs in the wet winter and spring.
Andrew Marshall
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
