Australian farmers have planted a lone seed of optimism among the economic doldrums as their confidence grew to its highest level in nearly five years, a survey has found.
Despite swathes of rural countryside being devastated by bushfires about half of farmers surveyed across the nation expect the agricultural economy to improve during the forthcoming year.
Late summer rains and strong commodity prices are being credited for the surge of optimism in the sector after sentiment took a dive following a record-dry spring in 2019.
Rabobank Australia, which conducted the survey, said the biggest boost to confidence had been in drought-ravaged regions of NSW and Queensland.
The regional bank’s chief executive Peter Knoblanche said widespread rainfall had delivered a great start for Australian farmers in 2020. Demand and commodity prices are also in the industry’s favour.
“These factors will help farmers break free from the shackles of drought and hopefully move into a more favourable production cycle, but further rain throughout the year will be crucial,” he said.
However ongoing bushfire recovery costs have tempered the record turnaround while the impact of the global coronavirus pandemic had yet to be factored.
But after seven years of dry, beef producers in Queensland were determined to claim 2020 as their comeback year, with three times as many farmers optimistic about the year ahead compared to the December quarter.
The majority of sugar cane growers and 45 per cent of mixed cattle and sheep runners are also feeling confident with producers in NSW, Tasmania and Victoria expecting positive turnarounds.
And though rainfall has been limited, a third of West Australian farmers still think conditions will improve while just 12 per cent think things will get worse.
They are also predicting an increase in their gross personal income, up 15 per cent from the December quarter.
“It’s heartening to see how confident so many farmers are,” Mr Knoblanche said.
Even the spectre of climate change and its hotter, dryer temperatures were not enough to dampen positivity.
More than two thirds of farmers said climate change would impact their business during the next decade and the majority were taking steps to mitigate the impact, mainly through changes to their water and irrigation use and reduction of livestock.
It is the first time agribusinesses have been quizzed on climate change by the survey, which has been conducted every quarter since 2000.