Rabobank Rural Confidence Survey shows increase in positive outlook

Heavy rains around Blayney have seen landholders put the feed away, and the optimism is spreading.

 Central West farmers have begun to show a positive outlook following rain in October and November, but their sentiments are still at subdued levels.

That’s according to the latest Rabobank Rural Confidence Survey.

The quarterly survey showed that the percentage of NSW farmers with a negative outlook on the agricultural economy in the coming 12 months fell from 69 per cent in the third quarter (July, August, September) to 47 per cent in the last quarter (October, November and December) of this year. 

“The remainder of farmers were equally split as to whether conditions were likely to improve (24 per cent, up from nine per cent) or remain the same (24 per cent, from 13 per cent) in the coming year,” it said.

“Drought remained the key driver of pessimistic sentiment, cited by 94 per cent of those with a negative view as a reason conditions were likely to deteriorate.”

Bathurst and Dubbo received more than their long-term average rainfall in November, while Orange fell about 15 millimetres short, according to official Bureau of Meteorology figures.

Rabobank Central West regional manager, Toby Mendl, said there had been “some very handy rain” in recent weeks, but it was not drought-breaking as soil moisture profiles remained deficient.

“But the rain that has fallen has allowed some graziers to get off the feed carts for a while, and lock away some paddocks, although they will be looking to start feeding again with the hot weather approaching,” Mr Mendl said.

The Rabobank survey showed farmers continued to indicate strong business viability in comparison to past drought periods.

“While seasonal conditions remained challenging in many regions, they had done little to dent longer-term optimism, as reflected in ongoing investment in the sector and the strength of the rural property market,” it said. 

Mr Mendl said a high number of dairy farmers hold a negative outlook on the coming 12 months. 

“About 61 per cent of surveyed dairy farmers in the state continue to have a negative outlook, possibly because of the high cost of fodder and escalating cost of water,” he said.

“Many dairy farmers have already had to foot large feed bills to get them through this year.

“There is little respite foreseen until there is a sustained turnaround in the season.”

The survey also found the long-term confidence in the agriculture sector was relatively sound for the coming year.

“While the percentage of farmers planning to increase investment stands at 16 per cent, the majority of survey respondents (60 per cent) are still looking to maintain a similar level of investment in their business over the next year,” Mr Mendl said.

The percentage of those farmers who anticipated lower income has also come down from 69 per cent to 56 per cent.