Dairyfarmer confidence levels have turned around on the back of expectations that prices will increase in 2017/18, according to the latest quarterly Rabobank Rural Confidence Survey.
The survey found dairyfarmers had posted the largest turnaround in confidence, to levels last seen in mid-2014, as farmgate margins look set to improve throughout the year.
The survey did, however, report some uncertainty in the medium-term outlook, with almost a third of farmers reporting concern the new US administration may negatively impact Australian agriculture.
Rabobank national manager Country Banking Australia Todd Charteris said while the hot summer in eastern Australia had driven the pull-back in confidence, the nation’s farmers were poised for a good year
Mr Charteris said the large turnaround in confidence posted by dairyfarmers this quarter had been driven by the improved expectations for the sector.
“Farmgate prices for southern export-orientated dairyfarmers are expected to increase in 2017/18, while producers in the fresh milk market are anticipating prices to remain stable at relatively elevated levels,” he said.
While the Rabobank survey found Australian farmers to be generally positive about the outlook for 2017, the results highlighted some uncertainty stemming from the recent change in US government.
A total of 30 per cent of farmers surveyed reported having concerns the new Trump administration may have a negative impact on Australian agriculture, particularly on trade relations with the US.
“Although it is too early to assess the impact of the Trump presidency on Australia’s agri sector, it is clear the administration change in the US is providing some uncertainty in the near-term and potentially some turbulence in the medium-term on economic and regulatory fronts,” Mr Charteris said.