Australian farming is worth more money than ever before.
The national commodity forecaster expects the value of agriculture to reach $81 billion this financial year — that's up more than $12 billion on the previous record, set last year.
The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) attributed the rise in value to a record grain harvest and the highest prices paid for Australian produce in 32 years.
"It's been a remarkable year for Australian agriculture on the back of a remarkable year last year," ABARES executive director Jared Greenville said.
Dr Greenville said the conditions meant average farm incomes for 2021-22 would be significantly higher than last year.
On average, broadacre farm incomes were up 34 per cent to $278,000, dairy farm incomes up 35 per cent to $337,000, and cropping farms up 40 per cent to $572,000.
Agricultural exports were expected to be up by a third on last year, valued at more than $64 billion — also a record.
"It's pretty good across the board," Dr Greenville said.
"With production at record highs and high prices, increases in income are likely to far outweigh the additional pressure of higher input costs for fuel, fertiliser, chemicals and labour."
As part of its annual commodity outlook, released today, ABARES said the winter crop production for 2021-22 had reached a record 61.9 million tonnes.
Agriculture has got the chocolates
At Bowning in southern New South Wales, farmer Sam Kelly said he could not remember a better time.
"Not in my lifetime and even in my dad's lifetime; he maintains it's one of the best seasons we've seen, we've had rain at the right time," Mr Kelly said.
A cattle, cropping and sheep farmer, Mr Kelly said farmers across the country were benefiting from high prices for their produce.
"Cattle prices are extraordinary at the moment, grains prices are quite strong, wool is fairly solid from where it was at the beginning of the pandemic, and sheep prices have maintained as well."
Keagan Size works at Mr Kelly's property and said it had been a "phenomenal two years".
"We haven't missed out whatsoever … agriculture's definitely got the chockies at the minute."
Wine bucks trend
However for some farmers, 2021-22 would be a backward step.
The value of wine grape production fell by 28 per cent to around $870 million due to lower prices and lower production.
ABARES attributed the fall to China's decision to impose tariffs on Australian wine.
Slower times ahead
Dr Greenville said the farm sector could not expect the good times were indefinite and that it was likely prices would soften next year.
"We are expecting the gross value of agricultural production to fall by around 6 per cent to $76 billion next financial year," he said.
That would be the second-highest-value year on record and short of the government-endorsed industry goal to make Australian agriculture a $100 billion sector by 2030.
Dr Greenville said it was too early to comprehend the impact that flooding in South-East Queensland and northern NSW would have on production, but it was likely events in eastern Europe would have an impact on agriculture's bottom line.
"It's terrible news in the Russia-Ukraine space," he said.
"For grain markets, Russia and Ukraine make up about 30 per cent of wheat exports and about 20 per cent of barley exports.
"Currently we've got high prices because of drought conditions in America; that's likely to stick around and there'll be increased volatility.
"Fertiliser and energy input prices are high at the moment as we know, and there's an expectation with ongoing conflict and disruption that could stay higher for longer — that'll be the main impact we see on the sector."
