GOOD rainfall and high commodity prices have driven strong farm financial performance for 2021-22, particularly in the Western District.

The current farm cash income for specialist cropping farms in the Western District in 2021-22 was over 25 per cent above average compared to the average for the district over the previous 10 years (see graphic).

The average farm cash income for specialist cropping farms at the national level is estimated to have been around $897,000 per farm in 2021–22, around 89 per cent above the average in real terms for the previous 10 years.

Although remaining strong, incomes in 2021–22 for specialist cropping farms in Queensland, southern New South Wales and parts of South Australia were below the long-term average.

The average rate of return (excluding capital appreciation) for specialist cropping farms at 5.7 per cent in 2021–22 is estimated to have been well above the 10-year average of 4.2 per cent per farm.

Executive director of the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), Dr Jared Greenville, said cropping farms had reported higher than average cash incomes over the last year.

“It’s been a boom year. At the national level, farm cash income for cropping farms is estimated to have increased by around 28 per cent to average $619,000 per farm in 2021–22,” he said.

“We can put this down to higher receipts from wheat, barley, oilseeds, and grain legumes.

“That said, prices are higher for farm inputs such as fuel and fertiliser, and this has affected returns and will do so even more into 2022-23.

“It’s been a solid year for livestock producers as well. At the national level, average farm cash income for livestock farms is estimated to have increased by around 10 per cent in 2021–22 to average $202,000 per farm.

“A combination of high commodity prices, especially for beef cattle, and good seasonal conditions have delivered strong financial returns for livestock producers.

“Ongoing productivity gains in Australian agriculture have helped drive the strong farm performance result in 2020–21.

“Over the long-term, average annual productivity growth in the broadacre industry was 1.0 per cent, and 1.3 per cent in the dairy industry. “Looking beyond the averages, we see that broadacre sector performance is being driven by larger farms with the largest 10 per cent of broadacre farms producing around half of total output, while the smallest 50 per cent of farms produce around 10 per cent of total output.”