Western Australia’s agricultural export industry continues to face a plethora of ‘economic headwinds’. As many farmers are waiting for rain, the mid-year agricultural outlook report from the Rural Bank revealed a stark contrast in sentiment and expectation for those growing various commodities in WA. Although it found favorable seasonal conditions and strong production in the first half of the calendar year, softening commodity prices were now affecting farmers after several years of good prices.
Rural Bank head of agribusiness development Andrew Smith said three “key themes” affecting agriculture in the second half of the year were dry seasonal conditions, trade conditions and persistent economic headwinds now swirling across the globe.
“A higher Australian dollar is also expected to weigh on the competitiveness of Australian agricultural exports, but overall, we expect marginal impact with our dollar still sitting below historic averages,” he said. “Below median rainfall is very likely across most of Australia over the next six months and it’s this drier seasonal outlook that’s now weighing on production forecasts across a range of agricultural commodities.”
The Russian invasion of Ukraine continues to drive volatility across both grain and oilseed markets, but the diversification of Australia’s export markets would “hold Australian exporters in good stead”.
Source: countryman.com.au
