Farm finances boom but costs forecast to bite

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21 June 2022, AU: Good rainfall and high commodity prices have driven strong farm financial performance for 2021-22.

Executive Director of ABARES Dr Jared Greenville said cropping farms had reported higher than average cash incomes over the last year.

“It’s been a boom year. At the national level, farm cash income for cropping farms is estimated to have increased by around 28 per cent to average $619,000 per farm in 2021–22,” Dr Greenville said.

“We can put this down to higher receipts from wheat, barley, oilseeds, and grain legumes.

“That said, prices are higher for farm inputs such as fuel and fertiliser, and this has affected returns and will do so even more into 2022-23.

“It’s been a solid year for livestock producers as well. At the national level, average farm cash income for livestock farms is estimated to have increased by around 10% in 2021–22 to average $202,000 per farm.

“A combination of high commodity prices, especially for beef cattle, and good seasonal conditions have delivered strong financial returns for livestock producers.

“Ongoing productivity gains in Australian agriculture have helped drive the strong farm performance result in 2020–21.

“Over the long-term, average annual productivity growth in the broadacre industry was 1.0 per cent, and 1.3 per cent in the dairy industry.

“Looking beyond the averages, we see that broadacre sector performance is being driven by larger farms with the largest 10 per cent of broadacre farms producing around half of total output, while the smallest 50 per cent of farms produce around 10 per cent of total output.

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