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18 December 2019
A new Rabobank Rural Confidence Survey has shown sentiment in Victoria’s agriculture sector at a 12-month low.
The survey showed a ‘state of two halves’ as confidence nosedived in northern Victoria and parts of Gippsland while south-western Victoria, buoyed by good rain, was comparatively strong.
Despite a drop-off in overall rural confidence, the strength of Victoria’s farming sector remained stable, with 92 percent of people surveyed rating their farms as viable.
This flowed into ongoing investment in the sector, with 85 percent intending to maintain or increase their investment.
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A fifth of farmers expect agricultural economic conditions to improve in the year ahead, down from 37 percent with that view in the September quarter.
Those expecting little change to current conditions stood at 36 percent, similar to last quarter’s reading of 39 percent.
However, the proportion expecting conditions to worsen more than doubled to 35 percent, up from 16 percent previously.
Drought was a key driver of negative sentiment, with 91 percent of those farmers expecting business conditions to worsen blaming the season. Rabobank regional manager for southern Victoria and Tasmania Hamish McAlpin said dry conditions had intensified ‘north of the divide’, with some parts of the northern Mallee facing a second failed crop in a row while crops in other northern regions had been cut for hay.
“Heading into spring the state was on track for an above-average harvest volume, but the poor finish has greatly diminished prospects in the Mallee, north central and Goulburn regions,” he said.
Mr McAlpin said rainfall during the growing season had been relatively low in the Wimmera, but many had been able to preserve moisture and this year’s crop was shaping up to deliver one of the best financial results for growers in the region.
“Those in the western district cropping regions benefited greatly from late-spring rain of between 15 to 35 millimetres,” he said.
“Prior to that critical spring rainfall event, growers had received enough to keep crops going, but there were fears yield potential might suffer.
“The early November rain alleviated a lot of those concerns however, and, with the frost window now behind us, yields in the southern regions are expected to come in above average.”
While the survey revealed heightened seasonal concerns, Mr McAlpin said the story for Victorian farmers was still a positive one.
He said data showed income projections remained strong – particularly in dairy and grains.
“The survey found 41 percent of the state’s dairy farmers expect an improvement in gross farm incomes in 2020, while 37 percent of grain growers also hold that view compared with this year,” he said.
“We are seeing some investment going into new dairies in Gippsland as well as infrastructure development in the grazing regions of western Victoria.”
The entire December 18, 2019 edition of The Weekly Advertiser is available online. READ IT HERE!
The entire December 18,, 2019 edition of AgLife is available online. READ IT HERE!