All you need to know from ABARES’ Outlook 2018

What you need to know from ABARES’ Outlook 2018


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Regardless of if you are a grazier, farmer, or an agricultural watcher, here's everything you need to know about what's on the horizon for ag.

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National farm commodities forecaster, Agricultural Bureau of Resource Economics and Sciences (ABARES) has released its latest forecasts for the agricultural industry as part of today’s Outlook conference in Canberra.

Poor global grain prices and a seasonally-stressed national grain harvest will wipe five per cent off the gross value of Australia’s farm production this financial year, but farmers are still expected to reap historically solid average incomes in 2017-18.

ABARES is tipping farm production to be worth $59 billion in 2017-18, then to recover in 2018-19 to $61b, and $63b (in current dollar values) by 2022.

The minor setback in the overall value of Australia’s farm sector did not dampen the enthusiasm of Agriculture Minister David Littleproud, who opened proceedings in his first Outlook conference in the portfolio.

Mr Littleproud said the future was optimistic with 1.2pc growth forecast for both the overall sector and exports, tipped to reach $63b and $50b by 2023, respectively.

“This shows we’re headed in the right direction,” Mr Littleproud said.

Read more here.

Here’s what is in store for individual commodities: 

Hot global beef competition to flow back to the saleyard

Senior government agriculture economists appear to be putting more weight in international beef trade dynamics than other analysts, forecasting a 15 per cent fall in saleyard cattle prices this financial year as a flow-on of red hot competition in markets like Japan and the United States.

ABARES has the 2017-18 weighted average saleyard price of beef cattle at 455 cents per kilogram, which is slightly lower than many in the industry expected.

Read more here.

Global wheat market weak to 2023

The global wheat market is expected to remain subdued beyond 2023, with rising production in the Black Sea region set to push prices to near-record lows.

The world wheat indicator price is forecast to rise modestly by 6 per cent in 2018-19 to $234, up from US$221 last year.

In response to consecutive years of low prices, major export nations are forecast to curb production to 742 million tonnes, following a 1pc reduction in the area planted to wheat.

Read more here

Pay day for sheep farmers

Australian sheep farmers are cashing in on historic meat and wool prices, as average farm income for the sector hits a 20-year high of $170,000 this financial year.

Figures from ABARES released today show sheep producers received an estimated 35 per cent pay rise, on the back of 6pc rise in saleyard prices for lamb and a lucrative 15pc spike in wool prices.

The hero of sheep farmers’ pay rise is wool’s significant growth in prices. 

Read more here.

Global growth signals upside for cotton growers

Global cotton prices are in for a bumpy ride in coming years, according to the ABARES 2018 Outlook report.

Good prices and favourable growing conditions have driven an increase in cotton supplies, spurring a forecast 2 per cent drop in Cotlook A index global indicator, taking it to US81 cents per pound in 2017–18 (the August to July marketing year).

However, increasing global demand for cotton driven by a growing global economy is expected to deliver a 5pc rise to 85 cents per pound in 2018-19.

Read about the full outlook here.

Nuts and fruit helping hort to soar

Fruit and nuts are set to drive Australian horticulture's production value to $13.6 billion in 2022-23.

The healthy forecast comes from the ABARES Outlook 2018 report for the March quarter, released today.

Much of that optimism comes from a rise in exports of Australian nuts and fruit, particularly to the seemingly insatiable Chinese appetite.

Read more here.

Milk production on the rise

Using incomes, more people and the ongoing Westernisation of diets will continue to fuel demand for dairy products on a global stage, underpinning prospects for increased production in Australia.

Analysts with the ABARES say world dairy prices will average higher this financial year but growth in the volume of exportable supplies after that will see most prices fall marginally.

World supplies are expected to grow faster than demand as major exporting countries, including Australia, expand output.

Read the full outlook here.

Avos continue their cautious climb

The staggering growth of the Australian avocado industry has prompted many observers to ask if the avo bubble will ever burst.

According to the ABARES, while the sailing is currently smooth for the sector, there are some potential submerged obstacles that could be approaching.

A three-year wait time for nursery trees is a commonly referred-to figure within the industry but the mass plantings of recent years could soon create some nervous growers.

Read more here.

Other nations look to get in on Australia's "clean green" hort export strategy

Australia might trade off its quality and "green" status but it's a strategy its export competitors are increasingly copying.  

A special report within today's ABARES Outlook 2018 agricultural commodities report casts a spotlight on Australia's comparative advantages for exporting fresh produce.

While it outlines that global demand has been growing strongly and is expected to continue, there are increasing moves by other southern hemisphere nations, and even China, to lift environmental farming status and produce quality, moves that could cause alarm for Aussie growers.

Read more here.

Blueberry production leaps ahead

The Australian blueberry industry has more than doubled its production in the past five years.

The impressive figure comes from ABARES’ Outlook 2018 agricultural commodities report for the March quarter.

The report puts the significant growth down, in part, to extensive plantings now coming online.

Australian production has leapt to 6800 tonnes, with a bigger goal on the horizon.

Read more here.

Pineapples facing import competition

The long-established pineapple industry faces a tough road ahead with imported processed fruit jostling for shelf space.

Pineapples are given a special mention within the ABARES’ Outlook 2018 agricultural commodities report for the March quarter, released today.

In 2015–16 the Australian pineapple industry reported having 1176 hectares of non-bearing area to contribute to future production (equivalent to 73 per cent of 2015–16 bearing area).

Read more here.

Here’s what was being said online:

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