SA farm profits down, but sheep returns buoyant

South Australian farmers are tipped to remain profitable this financial year, despite the ongoing drought, with the sheep sector agriculture’s shining light.

South Australian farmers are tipped to remain profitable this financial year, despite the ongoing drought, with the sheep sector agriculture’s shining light.

Department of Agriculture farm business performance figures show that in the year to June 2019, the average profit for SA farmers is set to be $79,000.

While lower than last year’s $114,300 profit, and much lower than the bumper $160,600 recorded in 2016-17, it still places the state’s producers in a good position compared to their interstate counterparts.

In comparison, NSW farms are projected to chalk up an average loss of $69,000 this year, Queensland farms are tipped to make a loss of $1000, and Victorian farms are expected to bank an average profit of only $10,000.

Across the nation, average farm cash income and profit is projected to decline for each of the broadacre industries, with the exception of the sheep industry.

In South Australia, mixed sheep and beef enterprises are set to bring in the biggest profits at $141,000 this year, with sole sheep enterprises close behind at $131,000.

It is a mixed bag for different areas of the state, with northern pastoral zone profits set to drop from $168,000 to $64,000, while the South East is set to remain fairly steady at $111,000.

South East livestock agent Robin Steen said with mutton reaching a very healthy price of almost $6 a kilogram in the region’s saleyards, it was a good time to be in the sheep industry.

“I think we could definitely break some more saleyard records this year,” he said.

“From Keith downwards, we haven’t really had to sell-off stock, like they have in other parts of the state.”

On the flip side, profitability in the dairy industry remains a major issue, with average farm incomes projected to decline in every state except Tasmania, largely due to lower milk production and higher expenditure on feed.

SA Dairyfarmers’ Association president John Hunt said greater transparency from milk processors would go a long way to improving profits in the sector.

“Back in August we knew feed costs were going to go up, so we tried to engage with processors to find out if they would need more milk, but received no indicators,” he said.

“Our margins are getting tighter and tighter, so we need clear signals from processors.”

Keyneton farmer Kym Graetz was not surprised the sheep sector was agriculture’s star performer.

“It’s definitely the sheep keeping us afloat at the moment, we just need some more feed for them,” he said.

Mr Graetz said the nine millimetres of rain that fell on his family’s property last week meant he could sow some sheep feed, but he is hopeful for further falls in the coming days.