A newly released ABARES report has tipped agricultural production to reach $90 billion for this financial year
Australian agriculture is set to achieve another record, with the national production output forecast to hit $90 billion for the 2022-23 financial year.
The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) released its latest agricultural commodities and crop reports, which is also tipping agricultural exports to reach record levels.
This comes despite crop damage caused by floods in eastern Australia, and overall projected production value jumps further from $90 billion to $96 billion when fisheries and forestry are included.
“Australia is benefitting from a third consecutive year of high rainfall, and it shows in the figures,” ABARES executive director Jared Greenville says.
“Once again, we’re seeing record levels of production, driven by exceptional growing conditions and high commodity prices.
“Agricultural exports are also forecast to set new records, reaching $75 billion in 2022–23.
“This is the first time we’ve seen our exports exceed $70 billion, which is a huge achievement.
“National winter crop production has driven much of these results, with the winter crop estimated at a new record of 67.3 million tonnes in 2022–23.
“This beats last year’s record by four million tonnes and is being driven by exceptional results out of Western Australia and South Australia.”
Wheat and canola production are expected to reach new records this financial year, ABARES says, while barley production is tipped to be the third highest on record.
Other data released by ABARES shows broadacre farm cash incomes are projected to drop by about seven per cent this year, averaging $327,000 per farm.
This remains 46 per cent above the 10-year average, ABARES says, while Western Australia and South Australia are the two states expected to buck the trend.
Dairy farmers are also tipped to be winners, with their total incomes projected to rise about 20 per cent to $391,000 per farm thanks to higher farm gate milk prices.
The overall national production figure brings Australia closer to the National Farmers Federation’s stated goal of $100 million farm gate output by 2030.
NFF has also previously stated further investment in the sector will be required to achieve this goal by that deadline.
Despite the strong overall numbers for 2022-23, Greenville warned against assuming the upward trajectory would continue.
ABARES is forecasting a drop to $81 billion in production value for the 2023-24 financial year, which would still be the third highest figure on record.
“This year will likely be the last hurrah for the La Nina rain system for a while, and we can expect drier seasonal conditions ahead,” he says.
“However, production will continue to be supported by good soil moisture and high water storage levels.
“Australia has been very fortunate to have had wet years and high commodity prices, but we are expecting commodity prices to ease with competition stepping up in global markets.”
Greenville also outlined what he believes will occur during the next five years for the agricultural sector.
“Over the medium term to 2027–28, seasonal conditions are expected to return to a more normal sequence and commodity prices are expected to fall,” he says.
“The value of agriculture will remain strong, reaching $74.4 billion in real terms.
“However, should we see a shift back towards a drier climate sequence and global economic uncertainty carry on for longer, greater pressure will be placed on sector growth.
“But we’ve had three years to create a buffer and recover from the last drought, so many of our farmers will be well placed to ride out these domestic and international changes.”