Survey reveals positive sentiment

Despite anxiety over late widespread frost and crop-damaging storms, a statewide bank survey has suggested farmers across Victoria are looking to 2018 with optimism.

Rabobank’s quarterly Rural Confidence Survey has reported strong positive sentiment across all agricultural sectors, in particular sheep and dairy industries.

The survey, completed last month, has also shown Victoria retaining its position of having the highest rural confidence levels in the nation.

Survey results at the time suggested eight out of 10 Victorians, buoyed by both commodity prices and seasonal conditions were anticipating higher or stable gross farm incomes in the coming year.

Its findings were that with climatic conditions favourable for much of the year, Victoria would buck the national trend as the only state on-track to harvest an above-average grains crop.

Results showed Victorian farmer confidence had rebounded to a net reading of 26 percent, after dipping to seven percent the previous quarter.

The proportion of the state’s farmers expecting agricultural economic conditions to improve in the next 12 months increased to 36 percent, up from 24 percent in the previous survey.

The percentage expecting conditions to worsen fell to 10 percent, from 17 percent, while more than half, 52 percent, had a stable outlook on the coming year.

Rabobank regional manager for southern Victoria and Tasmania, Hamish Mcalpin, said positive sentiment prevailing across the state was largely due to late winter and follow-up rain with some grain growers looking to harvest an average to above-average crop.

He said heavy early December rain in Victoria, while a significant weather event for some parts of the state, had less of a negative impact on crops than had been anticipated.

“Fortunately the heaviest falls focussed on predominantly grazing country in the north-east of the state, rather than cropping areas – although, horticulture in the northern part of the state will experience some negative impacts as a result of the large volumes of water,” he said.

Mr Mcalpin said Victoria generally had a good spring, moving into summer.

“And, although the warmer weather took a while to get here, the widespread falls in October helped many crops reach their potential,” he said.

“That said, there has been some significant damage to crops from frost, particularly in early November, with lentils in the north and cereals in the south the biggest casualties.”

Mr Mcalpin said the full extent of the frost damage was not yet known.

He said of all farmers in the state, sheep producers were the most bullish about their prospects.

He said 46 percent of sheep graziers reported a positive outlook on the year ahead, with a further 51 percent expecting stable conditions in the agricultural economy.

“Lamb prices have been strong for a number of years now, while wool prices continue to hit new records,” he said.

Across the sectors, commodity prices were deemed to be the biggest driver of positive sentiment, cited by 66 percent of Victorian farmers with an optimistic outlook.

This percentage rose to 82 percent in the sheep sector.

Seasonal conditions were also behind the optimism in the state’s agri sector, nominated as a key driver of confidence by 53 percent of those with a positive outlook – up markedly from 28 percent in a previous survey.

Farmers in south-west Victoria and the Wimmera-mallee were the most upbeat about seasonal conditions.

Victorian farmers also reported healthy expectations for gross farm incomes in 2018, with 38 percent expecting their incomes to increase over the coming 12 months, while a further 43 percent expected their financial position to remain stable.

The quarterly Rabobank Rural Confidence Survey questions an average of 1000 primary producers across a wide range of commodities and geographical areas throughout Australia.

The next results are scheduled for release in March 2018.