Ru­ralco cashes in as de­mand for wool out­strips sup­ply

AGRI­CUL­TURAL ser­vices group Ru­ralco has made a record full-year profit as it reaps the ben­e­fits of strong de­mand for wool.

Ru­ralco says its ru­ral sup­plies business ben­e­fited over the past year from good rain­fall in Vic­to­ria, Tas­ma­nia, South Aus­tralia and south­ern New South Wales as farm­ers bought more crop in­puts such as fer­tiliser and weed killer.

High prices for cat­tle, sheep and wool boosted earn­ings.

Post­ing Ru­ralco’s re­sults for the year to Septem­ber, chief ex­ec­u­tive Travis Dil­lon said sheep, lamb and wool prices re­mained high be­cause over­seas de­mand out­stripped sup­ply. The size of sheep flocks in Aus­tralia and New Zealand drove prices, Mr Dil­lon said.

Sheep and lamb are ex­ported all over the world but most of the wool goes to China.

Mr Dil­lon said global wool stocks were not suf­fi­cient to meet de­mand.

“There’s not enough sheep — the Aus­tralian flock of sheep is tens of mil­lions of head down on what it was in its peak,” he said. “It goes back to the dereg­u­la­tion of the wool price.”

Ru­ralco’s net profit of $22.4 mil­lion for the year to Septem­ber rose from $4.3 mil­lion in the pre­vi­ous year.

Its un­der­ly­ing profit, which ex­cludes one-off items, rose 95 per cent to $26.2 mil­lion, while rev­enue was up 2 per cent at $1.83 bil­lion.

The com­pany is pay­ing a fi­nal div­i­dend of 6c, fully franked, up from 2c a year ago.

El­iza MacMil­lan throws a fleece in the shear­ing shed on her fam­ily farm.

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