RISING livestock prices and outputs, and higher year-on-year crop production are expected to take Australia’s agricultural output to a record level in 2021-22.
Despite recent flood and rain damage in the eastern states, the ABARES Agricultural Commodities: December Quarter report is forecasting a history-making agricultural gross production value of $78 billion – $5.4 billion more than predicted just a few months ago.
The value of agricultural exports is forecast to hit a record $61 billion on the back of exceptional seasonal conditions and a surge in world commodity prices, according to ABARES.
Production is expected to increase year-on-year for every major livestock commodity and almost every major crop commodity – with farmers forecast to produce the largest volume ever.
Saleyard lambs prices are forecast to rise 9 percent to 850c/kg, wool prices are expected to lift 17pc to an indicator level of 1`390c/kg clean and live export sheep values are predicted to increase 5pc to $162/head. Saleyard cattle prices are forecast to rise 11pc to 758c/kg.
Australia’s lamb and mutton production is forecast to increase by 8pc to 680,000 tonnes in 2021-22, and beef production is expected to increase by almost 4pc to 2 million tonnes. Sheep slaughter is expected to increase by 13pc due to strong prices for marginal ewes that were kept on for an extra season. Lamb production is also forecast to increase as previous flock rebuilding brings more lambs to market.
Wool exports are forecast to increase by 28pc to $3.4 billion due to higher export prices and higher production volumes.
The gross value of production for the livestock sector is forecast to increase by 8pc to $33.4 billion in 2021–22 due to an increase in prices of most meat and livestock products. Global demand for livestock products is forecast to increase as countries continue to reopen.
ABARES is also expecting Australia’s winter crop production is forecast to reach a new national record of 58.4 million tonnes for 2021-22, following favourable growing conditions over spring. Record production of wheat (34.4 million tonnes) and canola (5.7 million tonnes) is expected. Production of barley is forecast to be the second highest on record (13.3 million tonnes).
ABARES executive director Dr Jared Greenville said Australia was enjoying an extraordinary combination of favourable conditions and 30-year price highs.
“It would be the first time in at least half a century that production will increase for so many products at the same time.
“And if these forecasts are realised, 2021-22 will see the largest total volume of agricultural commodities Australia has ever produced,” Dr Greenville said.
“Prices are also at multi-year highs for many agricultural commodities.
“Higher export volumes and higher prices are forecast for almost every major export commodity, with the total value of agricultural exports being revised up $6.5 billion to $61 billion, also an all-time high,” he said.
“This uplift in Australian agricultural production value and volume is unprecedented and the result of exceptional growing conditions here and poor seasons being experienced by key overseas competitors.
“There is uncertainty how long prices will remain at these levels – and supply chain disruptions, higher fertiliser prices and heavy rainfall domestically will continue to be watch points,” Dr Greenville said.
“This forecast accounts for the unfortunately timed substantial rainfall and localised flooding in east coast growing regions during November.
“This will delay harvests and result in some crop losses, but this is unlikely to reduce national harvest tonnage significantly,” he said.
“The larger impact will be on grain quality, with a higher than usual proportion of the crop being lower-value feed-grade wheat.”
The ABARES Agricultural Commodities: December Quarter report is available here.