A forecast all-time high $65.9 billion in production value this fiscal year confirms Australian agriculture is in the midst of an exceptional rebound from drought.
ABARES figures released at the virtual Outlook 2021 conference reveal the industry is both defying a pandemic and seeing off the effects of consecutive poor seasons.
“2020-21 is forecast to be an excellent year for Australian agriculture, with an expected eight per cent lift in production value on last year,” ABARES ’ acting executive director Jared Greenville said.
“The rebound from drought has been exceptional – in terms of the three consecutive years of decline and the sheer scale of the turnaround.
“Australia’s second largest winter crop of 55.2 million tonnes has catalysed this growth.
“Combined with favourable conditions and continued strong meat prices, the short term outlook is very positive, with the average national farm income projected to increase by 18 per cent to $184,000 a farm.”
Exports are forecast to fall four per cent to $46.3 billion in 2020–21 – mostly due to lower livestock numbers as herd and flock rebuilding leads to lower slaughter and meat production.
The medium to longer term outlook is less clear, according to Dr Greenville.
“While the sector has demonstrated resilience and the ability to adapt to COVID-19, other challenges remain,” he said.
“Shifting trade, along with macroeconomic and production uncertainties, will provide the backdrop for what we expect to be a more difficult environment in which to grow production and trade value.
“But over the longer term, we cannot forget that the fundamentals remain strong – middle income growth, urbanisation, population growth – will all be positive forces shaping sector fortunes.
“What will be important is creating the conditions to maximise the sector’s growth and contribution to the economy.
“Innovating and meeting consumer expectations around what we produce and how we do it, along with ensuring our export systems are efficient and reward producers for the quality of their product , will all be important in growing value in an uncertain future.”
Read the ABARES Agriculture Commodities March 2021 quarter report on the ABARES website.