Agricultural Sector Set to Break All Previous Records

Article by: Hari Yellina

According to the most recent overview, the agricultural industry continues to set new production and profitability records, although price corrections are on the way. Based on a revised prediction from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), the sector’s output will reach $81 billion in 2021-22, surpassing the previous year’s record by more than $12 billion. Minister for Agriculture David Littleproud, speaking at the annual ABARES conference on Tuesday, said agriculture had reached a “sweet spot” due to seasons and commodity prices, but that growth must continue.

Mr Littleproud stated, “Now is the time to undertake the reforms, to make the improvements that will boost Australian agriculture well beyond $70-odd billion and towards that $100 billion ambition.” The Secretary-General of the Organisation for Economic Co-operation and Development, Mathias Cormann, also spoke at the ABARES conference on Tuesday, telling the audience that the OECD is looking into phasing out “market distorting” agricultural subsidies. “Such measures are inefficient in distributing money to farmers since they disproportionately benefit those with the largest land holdings, and they worsen agricultural sector environmental concerns,” he said.

The forecast follows warnings from a UN climate change assessment that hotter and drier weather will affect rural communities, causing “disruption and decline” in Australian agricultural production. For the time being, the ABARES prognosis shows record cropping outcomes, with the highest-ever volumes of wheat, barley, and canola, as well as the second-highest yearly output of cotton. The revision is due to better-than-expected winter crop results, with higher yields in Western Australia driving up earnings, according to Jared Greenville, Executive Director of ABARES. “This is an extraordinary result,” he told AAP, “and it can be attributed to a combination of record high crop production and the best real pricing for Australian agricultural produce in 32 years.”

According to the Australian Crop Report, which was also released on Tuesday, national winter crop production is expected to hit a new high of 61.9 million tonnes. As a result of the wet spring and summer, much of the grain in NSW has been downgraded owing to weather damage. Despite this, NSW produced at near-record levels. Summer crops are predicted to be the fourth-highest on record, with production rising by 64% to 5.3 million tonnes in 2021-22. Farmers in Western Australia have had an “exceptional year,” according to Trevor Whittington, Chief Executive of Western Australian Farmers.

Mr Whittington said, “Some farmers believe it’s a once in a 50-year event… something no one could have imagined.” “There is a tremendous amount of trust in the sector.” “Incomes for crops farms have climbed by roughly 40%, animal income has increased by 24%, and dairy income has increased by 25%,” Dr Greenville stated on Tuesday. The dairy and cattle industries have benefited from high milk and meat prices, while the wine business has been hurt by international trade disruptions.

The gross value of wine grape production is predicted to drop by 28% in the fiscal year 2021-2022, with a further 7% drop expected the following year.