Victorian farmer confidence is slightly up, driven by the anticipation of an autumn break, according to Rabobank’s quarterly Rural Confidence Survey.
With rain in the next few weeks critical to shoring up confidence in the season ahead, Rabobank Australia chief executive officer Peter Knoblanche said commodity prices had remained strong.
‘‘Positive developments like improved access to overseas markets, such as the recent trade deal with Indonesia, and increased investment in agriculture are also helping to underpin longer-term positivity in the sector,’’ he said.
Mr Knoblanche said it had been a difficult start to the year for many, with drought and the country enduring its warmest summer on record.
The outlook for the year ahead all hinged on seasonal conditions, which remained uncertain heading into the critical autumn period, Mr Knoblanche said.
‘‘A good autumn break will be critical to allow farmers to get their crops in on moisture and to give graziers some relief from feeding stock. And significant rains are needed to boost irrigation storages, which remain low in all major systems in south-eastern Australia,’’ he said.
The latest quarterly survey found 33 per cent of Australian farmers expected conditions in the agricultural economy to worsen in the coming 12 months, a slight improvement on the 40 per cent with that view at the end of last year.
Drought remained the primary driver of pessimistic sentiment at a national level, cited by 82 per cent as the key reason for their negative outlook.
Nearly a quarter of Victoria’s farmers now expect conditions to improve (23 per cent, up from 18 per cent last quarter), while the percentage expecting conditions to worsen has nearly halved to 28 per cent, from 50 per cent previously.
In South Australia, Victoria and NSW — where last year’s winter crops were all below average and it remains dry in many regions — farmers were looking for a ‘‘decent autumn’’ to set them up for the year ahead, Mr Knoblanche said.
‘‘It is perhaps the most anticipated autumn break in a long time,’’ he said.
‘‘Coming off the back of a dry year, and in some areas, a consecutive run of dry years — farmers are ready to jump into their cropping programs with confidence if the season allows, although it will take time to ease the input cost pressures for those feeding livestock and to rebuild herds.’’
The biggest upswing in confidence was reported in the grains sector, with sentiment among grain growers outstripping other commodity sectors.
‘‘For grain growers, the winter cropping season is all ahead of them,’’ Mr Knoblanche said.
‘‘With local grain stocks at a 10-year low, the domestic basis is expected to stay above average into 2020, which is also helping to underpin confidence in the sector.’’