A RIP-ROARING season, red-hot demand for Australian-grown goods and commodity prices continually nudging records have created the perfect recipe for confidence within the farm sector.
The view that conditions are now as good as it gets has come through loud and clear in Rabobank's latest Rural Confidence Survey, which has almost 90 per cent of Australian farmers expecting the excellent business conditions currently being experienced to either continue or improve over the year ahead.
The big agribanking outfit's farm viability index, which measures farmers' assessments of their own business viability, has also now hit a 20-year high.
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Rabobank Australia chief executive officer Peter Knoblanche pointed to the 'ideal combination of positive seasonal, financial and commodity market factors' as driving the optimism.
"Strong prices for grain and terrific growing conditions in most regions have driven another near-record winter crop planting program across the country, with early estimates for a second-straight year of bumper tonnages of wheat, barley and canola when harvested at the end of the year," he said.
"Meanwhile commodity prices in the beef and lamb sectors are also supporting producer confidence, with low supply and high demand for protein pushing prices to levels not seen before. And dairy confidence is also strong on the back of favourable milk price contracts and improved water allocations."
Victorian branded beef owner Nick Sher, Sher Wagyu, said demand for premium beef in end markets, both overseas and domestically, was extremely strong and that was providing plenty of optimism in the cattle business.
The pandemic had reinforced the value of high-quality, naturally-produced red meat, and that was now combining with pent-up demand as food service came back online overseas, to create a very strong end market, he said.
"People don't expect the high cattle market to stay that way forever but they see a very positive outlook and great future for producing quality beef and lamb," Mr Sher said.
NSW mixed farmer Terry Fishpool, Tottenham, said last season was an exceptional one for grain growers.
"Yields were excellent and the unusual thing was it stayed dry the entire harvest in our region. In my lifetime I've never before seen that," he said.
However, it was the prospect of at least average seasons ahead that was underpinning confidence more, he felt.
"If farmers can get an average year for the next few in a row, that has more appeal than one bumper harvest," Mr Fishpool said.
Gloucester milk producer Graham Forbes, president of Dairy Connect's Farmers Group, said there had been a significant turnaround in farmgate milk prices and both cull cow and export heifer prices were very strong.
That was combining with lower feed input costs and improved seasonal conditions to allow most dairy farmers to expect a profitable year, he said.
Still, he felt it would be some time before the flow-through to widespread optimism in dairy happened.
"We have a lot of recovering to do. Droughts bushfires, floods and years of low farmgate prices has meant some producers incurred significant debt," Mr Forbes said.
"There are still a large number of dairy farmers looking at exiting and not many are expanding. In Victoria, there is also extreme competition for dairy land from sheep and beef producers."
Mr Knoblanche said 2021 was shaping up to be an instrumental year in the long-term prosperity of the Australian farming sector.
"For most farmers, we are seeing a second year of very good seasonal conditions, high to very high commodity prices, low interest rates and favourable infrastructure investment incentives from government," he said.
"The benefit of another year like this for Australian farming shouldn't be under-estimated. This will allow many farmers to really consolidate their position after years of drought, to further reinvest in their businesses to make them more efficient and resilient, and to expand and grow their businesses for the future."
He said even in those areas where seasonal conditions had not been optimal heading into winter, such as the cropping regions of South Australia and north-west Victoria, there was still a high level of confidence that the current positive business conditions would continue.