Grow­ers see lower prices on hori­zon

Port Douglas & Mossman Gazette - - NEWS -

RU­RAL con­fi­dence in North Queens­land has pulled back as the re­gion ex­pe­ri­ences another lack­lus­tre wet sea­son, ac­cord­ing to the lat­est quar­terly Rabobank Ru­ral Con­fi­dence Sur­vey.

Af­ter post­ing strong con­fi­dence lev­els in the sec­ond half of 2016, sen­ti­ment among NQ pro­duc­ers dipped this quar­ter to a net read­ing of 10 per cent, down from 40 per cent, the sur­vey found.

Re­gional man­ager for North Queens­land Trent McIn­doe says while some parts of north­ern Aus­tralia have had a re­ally good wet sea­son, not all have re­ceived the falls they hoped for.

“The coastal parts of far north Queens­land have done OK, but in the cen­tral parts of the north, both in­land and coastal, it has been very patchy.”

Both sugar cane grow­ers and beef pro­duc­ers re­vised down their ex­pec­ta­tions for the 2017 year.

Mr McIn­doe said while both com­modi­ties re­mained over­all in pos­i­tive ter­ri­tory – with more farm­ers ex­pect­ing con­di­tions to im­prove rather than de­te­ri­o­rate – the de­cline in con­fi­dence re­flected the ex­pec­ta­tion of eas­ing prices.

For sugar, while con­fi­dence had pulled back, the sec­tor re­mained pos­i­tive about the price out­look with 100 per cent of sugar cane pro­duc­ers sur­veyed across Queens­land nom­i­nat­ing com­mod­ity prices as rea­son for their con­fi­dence in 2017.

“We’ve seen near con­tracts on the ICE #11 pull back to $19.55 USc/Ib af­ter reach­ing four-year highs last Oc­to­ber, but there is still a lot of volatil­ity in the mar­ket and also some de­cent fun­da­men­tals keep­ing that price fairly buoy­ant,” Mr McIn­doe said.

“We have seen both beef and sugar pro­duc­ers lock in some good prices in 2016 and now as the end of fi­nan­cial year be­gins to loom many will be look­ing at tax ef­fec­tive ways to in­vest in their busi­ness us­ing this im­proved cash flow,” he said.

“For sugar pro­duc­ers in par­tic­u­lar, they may have held off on buy­ing plant and ma­chin­ery while the price was more sub­dued so they’ll now be mak­ing those pur­chases, ” Mr McIn­doe said.

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