Skip to content
Agriculture Farming Rural, Business Company News

WA farming confidence comes off after harvest-driven spike

Rabobank 4 mins read
Rabobank regional manager for WA, Steve Kelly

 

Results at a glance:

 

Western Australian farmers – who were buoyed by a record-breaking winter grain crop earlier this year – are now less confident about the prospects for the year ahead in the face of ongoing concerns about falling commodity prices, a challenging start to seeding and the threat to the live export market.

 

The latest quarterly Rabobank Rural Confidence Survey saw WA confidence fall further into negative territory, dropping from -21 per cent last quarter to -44 per cent. The latest reading is the third lowest confidence level recorded since 2004.

 

Only seven per cent of the state’s farmers expect agricultural economic conditions to increase over the next 12 months.

 

Of those who do expect the agricultural economy to worsen, falling commodity prices topped the list of concerns (46 per cent), followed by government intervention/policies (34 per cent) and rising input costs (33 per cent).

 

Rabobank regional manager for WA, Steve Kelly, said the latest results reflect the outlook of grain growers who – after crunching the numbers following harvest and getting this year’s crop in the ground – have reassessed their farm budgets for the year ahead.

 

“Commodity prices remain a cause for concern for nearly half of WA grain growers. Post-harvest, we saw a number of break-even budgets as farmers came to terms with softer commodity prices and ongoing high input costs including interest rates,” Mr Kelly said.

 

“Combined with a dry start to seeding, this saw a change in crop rotations, with reduced planting of canola in favour of cereals.”

 

With the state’s winter crop now in the ground, input costs were listed by 33 per cent of those WA farmers expecting business conditions to decline as a factor for the economy worsening – a drop from 64 per cent the previous quarter when growers were heading into seeding.

 

“The dip in confidence also reflects patchy seasonal conditions experienced in WA through autumn and low sub soil moisture in parts of the north-eastern wheatbelt and lower great southern,” Mr Kelly said.

 

“The varied start to seeding caused a lot of angst, so the significant rain falls received in early June have delivered a welcome boost for many.”

 

“And WA sheep producers continue to face uncertainty around what the future will hold for a key market,” Mr Kelly said. The survey found the threat to live export nominated as a factor by 32 per cent of WA farmers who anticipate worsening economic conditions.

 

Mr Kelly said while changes to the live export sector have been on the table for a while, it remains top of mind for producers and has been compounded in recent months by supply bottlenecks in the state’s processing sector.

 

“This has resulted in some WA sheep producers retaining stock which would normally have been sold before winter – another contributor to reduced confidence this quarter.

 

“Concerns about future market options are captured in WA farmers listing government interventions/policies as well as the specific threat to the live export market as their main concerns for the agricultural economy,” Mr Kelly said.

 

Seasonal, market and economic factors combined for subdued investment intentions in WA this quarter with only 17 per cent of farmers looking to increase their investment compared to 29 per cent the previous quarter.

 

Mr Kelly said farmers remain keen to develop their properties with upgrades to fences, yards, sheds and silos, but warned intentions to invest in on-farm infrastructure could be curtailed by supply realities.

 

“We’re still looking at a 12-month lag in many agricultural machinery and infrastructure supplies, which will impact the realisation of farmers’ investment intentions,” he said.

 

Of those looking to invest, appetite for farm-land in WA remained strong, with intentions for expansion similar to the previous quarter.

 

Of the WA farmers who are concerned about worsening conditions, 24 per cent cited increasing interest rates as a reason for pessimism, compared with 19 per cent in the previous survey.

 

“While there is continued strong prices for land offered, it’s not surprising to see interest rates now a higher consideration for purchasers,” Mr Kelly said.

 

A comprehensive monitor of outlook and sentiment in Australian rural industries, the Rabobank Rural Confidence Survey questions an average of 1000 primary producers across a wide range of commodities and geographical areas throughout Australia on a quarterly basis.

 

The most robust study of its type in Australia, the Rabobank Rural Confidence Survey has been conducted since 2000 by an independent research organisation. The next results are scheduled for release in September 2023.

 

<ends>


To arrange an interview with Steve Kelly, Rabobank regional manager Western Australia, or for more information on Rabobank’s Rural Confidence Survey, please contact:

 

Denise Shaw                                                    Will Banks     

Head of Media Relations                                 Media Relations Manager

Rabobank Australia & New Zealand               Rabobank Australia  

Phone: 02 8115 2744 or 0439 603 525           Phone: 0418 216 103

Email: denise.shaw@rabobank.com  Email: will.banks@rabobank.com


About us:

 

Rabobank Australia & New Zealand Group is a part of the international Rabobank Group, the world’s leading specialist in food and agribusiness banking. Rabobank has more than 120 years’ experience providing customised banking and finance solutions to businesses involved in all aspects of food and agribusiness. Rabobank is structured as a cooperative and operates in 38 countries, servicing the needs of more than nine million clients worldwide through a network of more than 1000 offices and branches. Rabobank Australia & New Zealand Group is one of Australasia’s leading agricultural lenders and a significant provider of business and corporate banking and financial services to the region’s food and agribusiness sector. The bank has 90 branches throughout Australia and New Zealand.

Media

More from this category

  • Business Company News
  • 24/07/2024
  • 07:00
SYDNEY: 0800 AEST Wednesday 24th July 2024

PRESS RELEASE: Industry-leading boutique consultancy The Bridge International announces a new specialist consulting practice ‘CXO2’ to help clients “Breathe new life into customer experience”.

CXO2 – Breathing New Life into Customer Experience - The Bridge International announces the launch of CXO2 led by CEO Sara Elmstrom and a selected team of CX experts. Today in Sydney, industry-leading boutique consultancy, The Bridge launches its specialist customer experience consulting business, CXO2. It is no secret that Customer Experience (CX) is fast becoming the key battleground for competitive advantage. Changing consumer expectations and the fight for talent coupled with the acceleration of emerging tech and AI is creating significant challenges (and opportunities) for CX across industries. CXO2 has been launched to help business leaders drive CX transformation,…

  • Agriculture Farming Rural, Animal Animal WelfareRights
  • 24/07/2024
  • 05:00
Australian Alliance for Animals

National campaign shines spotlight on plight of chickens farmed for meat

Launched today,Better Chicken Australia is the latest phase of the Better Chicken Commitment campaign backed by the Australian Alliance for Animals, World Animal Protection…

  • Contains:
  • Agriculture Farming Rural, Biotechnology
  • 23/07/2024
  • 15:56
La Trobe University

Nation’s food security tackled through new institute

La Trobe University is paving the way for Australian food security, with the establishment of a new institute that will expand cutting-edge agricultural research and innovation. The La Trobe Institute for Sustainable Agriculture and Food (LISAF) officially launched today (23 July), to undertake research and innovation across the agri-food-health chain, aiming to enhance profitability for producers while also improving product quality and choice for consumers. LISAF Director Professor Tony Bacic said a key component of the Institute’s “paddock to gut” research was to enhance plant functionality, enabling food and medicinal crops to be grown in innovative ways and with new…

Media Outreach made fast, easy, simple.

Feature your press release on Medianet's News Hub every time you distribute with Medianet. Pay per release or save with a subscription.