The agricultural sector is looking at another record-breaking year, with the gross value of production (GVP) forecast to reach $73 billion in 2021-22.
ABARES Executive Director Dr Jared Greenville said if the forecast in the Agricultural Commodities: September Quarter report proves to be accurate, then it will be the first time the agriculture sector has been valued at over $70 billion.
“The forecast for next year is due to a combination of factors, all tumbling neatly into place,” Dr Greenville explained.
“The value of crop production is set to rise by 7 per cent to $39.5 billion because of another near-record winter crop harvest, combined with strong global prices for grain, sugar and cotton.
“While there are risks related to mice, labour availability and continued uncertainties due to COVID-19, we are expecting national production to remain robust.
“The value of livestock production is also tipped to rise to $33.5 billion, an increase of 8 per cent.
“We’ve had a solid cropping year across the wheat-sheep belt, so we’re looking at another robust harvest.
“The international market is also tipped in our favour, as poor harvests in North America and Europe are pushing up the price of grain.
“Strong domestic production and a favourable global market are set to see exports also hit a record of close to $55 billion in 2021-22.
“The biggest contribution to growth in exports will be crops, which are set to rise by 17 per cent to $30 billion.
“A good year means optimism at the saleyards, and many of our farmers are enjoying their second good year in a row. This has translated to record prices for young cattle as farmers look to restock.
“Unfortunately, all good things must come to an end. Australian farmers operate in one of the world’s most variable climates so we cannot expect the good seasons to keep coming. The same can be said for high world prices.
“That said, the last two years have placed our farmers in a good position to take on any challenges ahead.”
The Agricultural Commodities: September Quarter report can be read on the ABARES website.