Farms’ bright outlook
DESPITE concerns over the dry weather in the south, Tasmanian farmers continue to be the most optimistic in the nation, according a confidence survey.
The latest national quarterly survey by agribusiness banker Rabobank shows while large areas of eastern mainland Australia struggle with drought, Tasmania’s agricultural sector has benefited from comparatively favourable seasonal conditions, coupled with generally strong commodity prices.
Tasmanian farmers continue to be the most optimistic in the nation, despite positive sentiment easing off from the highs recorded in the middle of the year.
While 60 per cent of surveyed farmers in Tasmania reported a steady outlook on the year ahead, expecting agricultural economic conditions to remain stable for another 12 months, the proportion anticipating an improvement was down on the previous quarter — 20 per cent, from 34 per cent previously. And an increased number had a pessimistic outlook at 18 per cent, up from 7 per cent.
Rabobank branch manager Tasmania Kathryn Brown said a run of good years in the state’s agricultural sector had also given farmers the liquidity and confidence to invest in their farming businesses, with two out of five surveyed looking to increase their investment in the coming year — well outstripping the national average.
Ms Brown said the easing in rural sentiment, from last quarter’s 18-month high, was driven by the state’s dairy sec- tor, with a decline in the number of dairy farmers with an optimistic outlook: 38 per cent, down from 60 per cent in the June quarter.
“There are increasing concerns among dairy farmers — and those with sheep and cattle — around the escalating cost of feed, with wheat prices jumping by 20 per cent in recent weeks,” she said.
Ms Brown said the rising cost of production was placing pressure on dairy margins, at a time when there was some uncertainty whether the milk price step-ups would eventuate.
Across sectors, the market outlook continued to underpin confidence levels among the state’s farmers — with commodity prices cited by 88 per cent as reason for their optimistic outlook, up from 81 per cent.
Ms Brown said despite the overall positive sentiment in the state’s rural sector, there were some concerns about dry conditions, in areas south of Ross.