Agriculture confidence rings in the New Year

Agriculture confidence rings in the New Year


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Wool production is expected to decline in 2016 as a result of drought but overall confidence in the industry is positive thanks to buyer demand.

Wool production is expected to decline in 2016 as a result of drought but overall confidence in the industry is positive thanks to buyer demand.

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With rain falling from Collarenebri to the coast this new year has arrived with confidence, despite a consolidation of commodity prices during the latter half of 2015.

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WITH rain falling from Collarenebri to the coast this new year has arrived with confidence, despite a consolidation of commodity prices during the latter half of 2015.  

NSW Farmers’ president Derek Schoen, speaking from a tractor on his Corowa property, predicted 2016 would be a “solid year for agriculture”.

“Pieces of the jigsaw are falling into place,” he said.

Our grains remain in vogue – especially chickpeas and mung beans - which should help offset the current global glut in wheat.

The China free trade agreement alone will see the removal of a 2 per cent sorghum tariff which will provide an immediate $7 to $8 per tonne advantage, said GrainGrowers chief executive Alicia Garden.

The removal of a 3pc barley tariff adds $30 million annually to that industry, she said.

Wool interest also appears positive, says Wool Producers’ chief executive Jo Hall, as Chinese traders seek to fill their orders ahead of their lunar new year holiday.

Of course market dynamics involve more than buyer interest – it comes with decreased supply as a result of drought in the western districts with national wool production expected to decline by 7pc over the coming year.

Thirty five per cent of this decline was in Queensland.

Beef demand remains strong despite softer US interest and fluctuating desire from an emerging China.

Meat and Livestock Australia managing director Richard Norton says the lower Aussie dollar combined with trade agreements reducing tariffs into China, Korea and Japan should buffer a softer US demand for grinding beef.

And if the dollar falls further that would only play into the hands of exporters with benefits flowing on to producers.

“But never underestimate the US population’s ability to eat beef,” Mr Norton said, implying that the current glut in America is more temporary than permanent.

“Globally speaking Australian beef is quite sought after compared to five or six years ago. And our lamb is a success story increasing $1.4 billion in value off Australian farms over the last decade.”

During 2016 Australian dairy products will be well positioned to take advantage of growth in South East Asia, China and the Middle East, with Australian Dairy Farmers director Simone Joliffe saying recent trade agreements combined with the reduced Aussie dollar have already created investor interest in dairy.

“That ability to attract investment will support the ability to innovate and grow,” she said.

Federal Agricultural Minister Barnaby Joyce, speaking ahead of a Queensland holiday with his family, pointed to the $4 billion Agricultural Competitiveness White Paper as positive proof the federal government was looking after the farming sector.

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