Glass half full prediction for Australian agriculture in 2015
16 February 2015
Storms, bushfires and widespread dry conditions saw 2014 finish with a run of high impact weather events.
However Suncorp Bank has today announced the long-term outlook for Australia’s agricultural sector was positive and farmers were encouraged to remain optimistic about the year ahead.
Suncorp Bank Regional Manager for North Queensland, Troy Constance said the strength of Australia’s agricultural sector, the low Australian dollar, recent rainfall, generational low interest rates and international demand for Australian produce underpinned Suncorp Bank’s positive outlook for the industry.
“The past year has delivered mixed fortunes for a number of commodities. Our heart certainly goes out to the regions and industries impacted by the recent weather conditions, but it is important for producers to maintain a long-term perspective,” Mr Constance said.
“Currency markets have increasingly played a greater role in shaping agribusiness commodities, especially commodities where Australia competes directly with the United States for market share.
“Wheat, beef and cotton industries are best placed to benefit from the depreciating Australian dollar, which is currently sitting at a four-year low against the US currency.
“The low Australian dollar may also present a new opportunity for sugar production, which has come up against strong headwinds at a global level in recent years.”
Figures released by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) indicate earnings from farm exports are forecast to fall by 8.6 per cent in 2014-2015 to $37.6 million. However at this forecast level, export earnings would still be 4 per cent above the average of $36.2 billion over the past decadei.
“Internationally, consumers have become increasingly concerned about food provenance and traceability. Fortunately for us, this trend has reinforced Australia’s reputation as a global leader in fresh produce, production facilities and prime land,” Mr Constance said.
“This international recognition, coupled with Australia’s unprecedented access to international markets off the back of Free Trade Agreements, generates a number of new opportunities for Australian producers.
“The recent weather conditions in parts of Queensland and New South Wales have also delivered a renewed optimism for the season ahead, with regions in central and south west Queensland experiencing some of the best rainfall witnessed in more than two years.
“This has resulted in substantial pasture growth, with a number of regions reporting full water storage.”
“Lamb and cattle prices have reached a record-breaking high in southern New South Wales, and despite a dry finish in Victoria’s western district, farmers have finished the winter growing season with a solid harvest.”
In addition to low fuel prices in a number of regions, Mr Constance said the adoption of emerging technological advancements will help farmers improve their efficiency and reduce overheads.
“A wider adoption of global positioning systems (for GPS) for precision or prescription farming and the ongoing use of telephony will continue to be preferred tools for remote monitoring activities. We will also start to see an increase in the adoption of drones on properties, which in the past has attracted some well-publicised debate,” Mr Constance said.
Mr Constance also confirmed Suncorp Bank would continue to deliver its extensive calendar of rural roadshows and resilience workshops across the country throughout 2015 and beyond.
“Suncorp Bank has been supporting farmers and agribusiness communities since it commenced operations as the Queensland Agriculture Bank in 1902,” Mr Constance said.
“Year-on-year we continue to grow our rural roadshow program and we are proud to work with industry leaders to deliver practical support and guidance to regional and rural communities throughout Australia.”
For more information on Suncorp Bank Agribusiness and the Suncorp Bank Agribusiness Roadshow Series visit: www.suncorpbank.com.au/agribusiness
About Suncorp: Suncorp Group includes leading general insurance, banking, life insurance and superannuation brands in Australia and New Zealand. The Group has 14,500 employees and relationships with nine million customers. Suncorp Group Limited is a Top 15 ASX-listed company with $94 billion in assets. Suncorp Bank is Australia’s leading regional bank servicing more than one million personal, SME and agribusiness customers.