Value of farm production forecast to rise
8 December 2015
The gross value of farm production is forecast to increase by 8 per cent in 2015–16 to around $57.6 billion. This is about 17 per cent higher than the average of $49.4 billion over the five years to 2014–15 in nominal terms, according to the December edition of ABARES Agricultural Commodities report.
ABARES Executive Director, Karen Schneider, said the forecast increase was underpinned by expected increases in the value of livestock and crop production.
"The forecast increase in livestock production mainly reflects expected increases in farmgate prices for beef cattle, lamb, sheep and wool,” Ms Schneider said.
"We expect farmgate prices of sheep and cattle to rise as producers rebuild flocks and herds and reduce slaughter in response to an assumed improvement in seasonal conditions.
"Export demand for beef and lamb is also expected to remain firm, adding further upward pressure on prices.
"Prices of wool are also expected to rise as a result of a forecast fall in production, based on a smaller opening flock, and an assumed lower Australian dollar.
"Forecast increases in winter crop and horticultural production are expected to more than offset falling world grains and oilseeds prices."
Ms Schneider also said that export prospects would remain strong for a range of farm commodities.
"Export earnings from farm commodities are forecast to increase by 1 per cent in 2015–16 to around $44 billion—around 15 per cent higher than the average of $38.2 billion over the five years to 2014–15 in nominal terms" Ms Schneider said.
"Export earnings are forecast to rise for a number of farm commodities, including wheat (3 per cent), wool (9 per cent ), wine (3 per cent), lamb (up 1 per cent), sugar (up 8 per cent), live feeder/slaughter cattle (16 per cent to $1.3 billion) and chickpeas (56 per cent).
"These forecast increases are expected to be largely offset by forecast falls in export earnings from beef and veal (3 per cent), dairy (6 per cent), coarse grains (14 per cent), canola (8 per cent), cotton (21 per cent) and mutton (2 per cent).
"Export earnings from fisheries products are forecast to continue their recent growth, increasing by 17 per cent to $1.7 billion, after an estimated increase of 10 per cent in 2014–15.
"This reflects continuing strong demand from Asia and is expected to be driven by forecast increased export earnings for salmonids (up 35 per cent), rock lobster (18 per cent) and tuna (7 per cent)."
The forecasts were released in the December edition of Agricultural Commodities, which includes ABARES latest outlook for Australia's key agricultural commodities in 2015–16.The December edition of the Agricultural Commodities Report is available at ABARES Publications.