ACCORDING to a Rabobank survey, farmer confidence has seen a lift from the first quarter of 2023, and this was based on more ‘normal’ seasonal conditions and commodity prices.
If there is one-thing we farmers will all agree on - we can’t control the weather, and it’s the one over-riding factor that can determine our viability.
That’s one reason why, there is so much research into genetically modified pastures - to help lessen weather impacts on production.
The survey found while still in negative territory overall, 13 per cent of Victorian farmers now expect business conditions to improve in the coming 12 months (up from nine per cent for the first quarter of 2023), and 37 per cent anticipate conditions to worsen (from 39 per cent previously).
Just under half (49 per cent) expect conditions to stay the same (down from 51 per cent). The main driver for those farmers expecting the agricultural economy to improve are good seasonal conditions (at 33 per cent, up from 27 per cent previously). While cattle and sheep prices have eased in recent months and wool prices are softer.
Victorian farmers listed commodity prices (at 67 per cent, up from 61 per cent in the first quarter) as a further reason for optimism.
Of those Victorian farmers expecting the agricultural economy to worsen in the coming 12 months, fewer were concerned about easing commodity prices (58 per cent, down from 69 per cent previously), and input costs (33 per cent, down from 38 per cent last quarter).
There was increased concern amongst farmers around drought (12 per cent, up from six per cent in the first quarter), government intervention/policies (17 per cent up from seven per cent previously), and overseas markets/economies (29 per cent up from 14 per cent previously).
Rabobank regional manager for Southern Victoria and Tasmania Deborah Maskell-Davies said farmers are aware that commodity prices are still reasonable and while prices may have eased in some sectors this year, farmers are generally, still receiving good returns.
“The rainfall throughout 2022 has delivered feed availability, filled water storages, and provided full soil moisture profiles - setting farmers up well for this season,” she said.
“But forecasts for a drier year ahead and predictions of the return of El Niño weather systems were weighing on some farmers’ minds when surveyed.
“However, since the survey’s completion last month, widespread rain has set up the state with adequate moisture coming into the spring.”
The dairy industry had the greatest lift in those expecting the agricultural economy to improve, with 19 per cent of dairy farmers holding an optimistic outlook compared with 11 per cent in quarter one.
Almost half (47 per cent) of dairy farmers expect agribusiness conditions to remain unchanged in the year ahead (previously 49 per cent).
While 31 per cent are anticipating economic conditions will decline.
“Dairy farmer confidence is upbeat - despite last week’s opening milk prices being around five to 10 per cent lower than last year’s prices - which were at record levels,” Ms Maskell-Davies said.
“Labour is an ongoing issue for Victorian dairy farmers, but the recent strong prices mean many farmers have taken the opportunity or are looking to upgrade dairy facilities - improving labour efficiency.”
Ms Maskell-Davies said access to quality fodder was an issue this year for dairy farmers as many fodder and grain growers had grain and hay crops adversely affected by the wet season in 2022.
According to the MLA survey, of 1958 sheepmeat producers across Australia produced the industry estimates.
Fifty per cent of sheep producers nationally cite weather as the number one issue affecting their on-farm decision making. While 31 per cent cited weather as their main off-farm external factor when it comes to running their business.
Net sentiment about the sheepmeat industry has fallen from 68 sentiment points in October 2022 to 27 sentiment points in May 2023, a fall of 40 points.
While most states remain positive, Western Australian sentiment about the industry has dropped to -48 sentiment points, meaning that more producers were feeling pessimistic about the future of the sheepmeat industry.
The surveyed producers cited their concerns about the future of the live export of sheep and potentially deteriorating seasonal conditions.
According to MLA’s Market Information Analyst Jenny Lim, said while sentiment from producers declined in all States, Western Australian producers’ overall sentiment declined by 90 points between October 2022 and May 2023.
“WA producers are noting that they have extra sheep on-farm, with processors working through a significant backlog and an oversupply of lambs,” she said.
The May 2023 survey had a specific focus on understanding the profile of Australia’s breeding ewes and wether flocks.
Of the estimated 46 million breeding ewes on hand, Merinos made up 64 per cent of total breeding ewe flock, while first cross sheep represented 14 per cent and prime lambs represented 12 per cent.
Producers in New South Wales, South Australia, Queensland, and Western Australia also have a larger proportion of Merinos, with Tasmania and Victoria reporting lower proportions.
Regarding producer intentions, there was a mixed response around their breeding ewes flock in the next 12 months:
• Thirty per cent indicated they would increase their breeding ewe flock size.
• Thirty-Eight per cent indicated they would remain unchanged.
• Thirty-Two per cent indicating they would decrease their breeding ewe flock size.
As for cropping - our areas around Lascelles/Hopeton are having a good start to the cropping season with the majority of paddocks sown down.
Cropping farmer Darren Mott crops 9500acres and said, “the sub soil moisture profile was very handy and follow-up 35 ml of rain after sowing Wheat, Barley, Lupins and Lentils was ideal”.
While he said that it was great to have this sort of start, he knows only too well that anything can happen from here - particularly as hail impacted their crops just prior to harvest last year.
As always - ‘cautiously optimistic’ was the forecast at the moment.
