Tuesday Jun 06, 2023
Australia's record-breaking run for agriculture is set to dry up, with winter crop production set to fall by more than a third, while overall output is also forecast to fall.
The latest quarterly outlook was published by the agency ABARES, which is responsible for agricultural science and economic research.
It forecasts agricultural output to fall 14 percent to US$79 billion ($52 billion) after three consecutive record years.
"We expect agricultural production to pull back from what has been a peak for some time, last year we reached almost $92 billion," ABARES Executive Director Jared Greenville told AAP.
"This is largely due to a return to more average to below average yield, particularly in our winter crop," he said.
Although it had been a mixed start to the crop season, Dr Greenville said production was still expected to reach 44.9 million tonnes, the sixth largest on record.
One of the key factors behind lower crop yields is the latest seasonal outlook, which expects drier conditions.
Lower yields will also see a significant drop in exports, while inflation will also eat into producer profits and affect consumer demand.
The increase in mouse activity also had an impact as growers began using more bait.
The quarterly crop outlook shows wheat production will fall 34 percent, slightly below the 10-year average, with barley down 30 percent and canola down 41 percent.
Summer crop production is also expected to decline from record highs and remain above the 10-year average.
It's not the same story across all industries.
Horticulture is expected to grow by $1.5 billion to a record $18 billion, thanks to strong growth in nut production and increased demand for locally grown fruits and vegetables.
Dr Greenville said the wine industry was also recovering from a tough year, with drier conditions reducing the risk of disease.
In the livestock sector, results were mixed, with slight increases in beef, sheep and dairy production, but a decline in the value of livestock production due to lower prices.
This is due to a number of factors such as less demand for restocking, and as with crops, we expect global production to pick up,” Greenville said.
The agency expects strong wool growth, with Chinese demand driving higher prices.
A predicted decline in overall agricultural output has prompted warnings from one farming group, with the Victorian Farmers Union urging its members to prepare for drier conditions.
“Farming is cyclical and the best preparation for tough times is when things are going well. That time is now and there is no time to waste,” said the group's Emma Germano.
“For drier seasons, this means prioritizing drought preparedness, sustainability, resilience and risk management for farms and communities well in advance of the onset of drought.
