THE beef, grain and wool industries all appear to be embarking on an upward economic trend as the agriculture sector recovers nationally from widespread drought.

Optimism among farming communities is also high, even in Queensland despite 60 percent of the state still drought declared.

Separate studies published this week by ANZ and Rabobank point to a promising outlook for the agriculture sector, despite added challenges created also by international market pressures and trade tensions.

ANZ’s latest Agri Commodity Report indicates Australian crop farmers are on track to produce more than 50 million tonnes of wheat, barley and canola for only the second time on record.

Current forecasts predict that wheat production alone could jump by more than 100 percent to around 30 million tonnes, the ANZ report said.

Many farmers across southern Queensland managed strong yields but ANZ’s head of agribusiness, Mark Bennett, said the biggest turnaround from previous years has been in New South Wales, where the harvest is tipped to produce more than four times the volume of grain yielded in 2019.

“While the scale of the crop has created a lot more work, many of the earlier disruptions we were expecting to see as a result of border restrictions have fortunately not eventuated,” Mr Bennet said.

“We’ve also seen that the scale of the crop, combined with expected large crops from other countries, has contained domestic prices to some degree, though they’re still at a level welcomed by most in the industry.”

The beef industry isn’t bouncing back quite as quickly, the report said, with massive de-stocking amid the drought causing the national herd to fall to a multi-decade low of around 25 million head.

ANZ’s head of agri insights, Michael Whitehead, said it may take until around 2030 for the herd to return to its 2014 peak of 29 million head.

“With the arrival of long-awaited rains and green feed in most regions, cattle producers worked hard to rebuild their herd numbers toward previous levels, a move which led to this year’s record cattle prices,” Mr Whitehead said.

“In the absence of more drought conditions, the number of cattle on the market for slaughter is likely to remain limited for some time, reducing the chance of major downward pressure on prices.

“Looking ahead, while some uncertainty lingers about Australian beef exports to China, trade is still flowing strongly, while recovery from initial COVID disruptions continues to impact other major markets including Japan and South Korea.”

For the full ANZ Agri Commodity Report, which includes strong sheep industry outlooks, click here.

Meanwhile spring rainfall, a promising seasonal outlook and strong commodity prices have helped to restore confidence in agribusiness, according to the latest quarterly Rabobank Rural Confidence Survey.

The latest survey revealed 37 percent of Queensland producers expected agricultural economic conditions to improve over the coming year – up from 23 percent from last quarter.

The study said seasonal conditions and commodity prices were largely behind the renewed optimism, cited by 66 and 64 percent of Queensland producers respectively.

However Rabobank regional manager for Northern Queensland and Northern Territory, Trent McIndoe, said that while areas of the state had enjoyed good rain and a successful harvest, Queensland was still a “mixed bag”.

“Drought is continuing in some areas of the state, with a number of failed crops in the southern district, however the turn in the season and positive outlook has certainly given farmers the confidence that it can, and will, rain again.”

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