Aussie ag value to hit $85b in rebound year

The value of Australian agricultural production is predicted to rise after last year’s 15 per cent dip, as farm incomes recover by almost 50 per cent.

A bounce-back year for Australian agriculture has been forecast thanks to a mix of improved farmgate fortunes and more favourable seasonal conditions.

The Australian Bureau of Agricultural and Resource Economics and Sciences has predicted agricultural production will reach a value of $85 billion during 2024-25, a 6 per cent increase year-on-year, while the average farm cash income is set to recover by almost 50 per cent.

Drier seasonal conditions and depressed saleyard prices for livestock saw the value of agricultural production revised down to $80 billion in 2023-24, a 15 per cent decline on the huge $91.5 billion 2022-23 year and $10 billion less than what was forecast 12 months ago.

The rebounding value of agricultural production is set to be underpinned by improved livestock prices in 2024-25, particularly beef and veal, which is forecast to increase by 25 per cent to $15.7 billion due to higher cattle saleyard prices and a small increase in beef production.

Livestock prices are predicted to rise this year, due to improved demand from restockers and at the saleyards. Picture: Zoe Phillips

ABARES has forecast an average of 599c/kg for heavy steer and processor cow saleyard prices, a 24 per cent increase on the average figure in 2023-24.

Similar improvements are also expected for the sheep and lamb market, which is set to rise by $758 million, or 21 per cent, to $4.3 billion in 2024-25.

ABARES executive director of Dr Jared Greenville said the 2024-25 year is forecasted to be the third highest on record for the gross value of Australian farms, fisheries and forestry.

“For our livestock production and livestock products industries this is a record high and the result of expected favourable climate conditions and improving prices,” Dr Greenville said.

“Above-average summer 2023–24 rainfall and subsequent build-up of soil moisture reserves in eastern Australia is expected to provide a good incentive for planting ahead of the 2024–25 winter crop season.

“Broadacre farm cash incomes are also set to rebound in 2024-25 to $192,000, after significant falls in 2023–24.

“The forecast improved growing season climate conditions and the expected turnaround in livestock prices in 2024–25 will drive increases in farm income.”

Meanwhile, the value of the nation’s wool clip is expected to increase by $131 million to $3 billion as higher wool prices are expected to outweigh lower production.

In cropping markets, canola production is forecast to reach $4.1 billion following a $255 million increase, or 7 per cent, while despite more favourable growing conditions, wheat production is expected to increase by just 2 per cent to $10.4 billion due to easing world prices.

However, the improved fortunes for cropping and livestock are not expected to be shared in the dairy sector, with the value of milk production to drop by more than 7.5 per cent, or $420 million, to $5.5 billion.

ABARES said relatively low export prices for dairy products were anticipated to reduce the farmgate prices processors can offer for the 2024-25 season.

Finally, the value of the nation’s horticultural production is expected to set a new record at $17.8 billion, a 3 per cent increase year-on-year, as higher domestic production volumes outweigh lower prices.