Australia’s agribusiness sector is for the the first time in three years upbeat about the future.
The companies expect profitability to improve over the next 12 months, according to the latest National Australia Bank (NAB) quarterly post-farmgate agribusiness survey.
The September quarter survey of 900 Australian agribusinesses also showed a surge in expectations for business conditions for the next 12 months, reaching their highest point in nearly two years
NAB Agribusiness General Manager Khan Horne: “A number of favourable economic and agricultural developments in the quarter have aided current conditions and expectations for the future.
“These include an RBA reduction to the cash rate in August, improved weather conditions supporting the outlook for dairy and crop production and continued low input costs.”
Confidence in crops was up mainly due to rising domestic wheat prices relative to global values as domestic stocks continue to tighten ahead of harvest.
“We’re seeing processors benefit from strong commodity prices due to tight supply and a lower AUD boosting competitiveness,” says NAB’s Horne.