Rising input costs and disease pressures have driven Australian farmer confidence to its lowest point in three years, but analysts say there's room for optimism.
It's the first time the rural confidence survey has gone into negative territory since December 2019.
Rabobank releases quarterly reports after surveying 1,000 farmers across different commodities and regions.
The third quarter results show more farmers have a more pessimistic than positive outlook for the year ahead.
Regional Manager for South Australia Roger Matthews said conditions had changed since the last survey.
"Commodity prices have eased down since sort of June, July and into August," he said.
"We've also seen the cost of inputs whether that be interest rates, fertiliser, and access to inputs rising."
'Rise and fall'
Only 14 per cent of farmers expect agribusiness conditions to improve, that's dropped from 28 per cent.
85 per cent were extremely concerned about the threat of foot-and-mouth disease and its impact on the agricultural industry.
Breaking down the results livestock producers were the most pessimistic group whereas cotton, dairy, sugar and grain producers were more optimistic.
Mr Matthews said he's not concerned about these results.
"Confidence — it's a point in time so there's volatility in that index itself," he explained.
"It will rise and fall."
Optimism remains
Alizah Fogden, a stud cattle breeder in South Australia, said initially she was extremely worried about the threat of foot-and-mouth disease.
"We thought the worst. We have heard stories of farmers having to burn destroy their animals in large piles," she said.
But now like a lot of producers she's feeling more confident for the year ahead.
"We've been able to purchase a couple more bulls to take that operation into the future," she said.
"Which is a really exciting time for us."
Mr Matthews said this follows a national trend with a quarter of farmers looking to increase the investment in their business.
"Even though sentiment overall was negative, the intention is to actually expand with property purchase still actually quite high," he said.
"I think that goes to that longer-term trend and you've got farmers with very strong balance sheets."
