Annually, Farmanco puts together an Agribusiness edition of Farmanco Facts, for ag industry bodies outside of our client base. We've chosen articles that we think will be useful and interesting to bankers, accountants and agronomists.
Mike Monaghan is a Farm Management Consultant based at Moora and new to Farmanco in 2020. An excerpt of the Agribusiness editorial follows:
For once, we have a season that is above average for most of Australia's southern cropping and livestock zones. This comes at a time when commodity prices have held at reasonable prices.
Of course, it is a big country, and not everyone will have had a good season. Particularly tough areas include parts of the central midlands, central wheatbelt, south coast of WA and much of the Queensland cropping zone.
The return to broadly favourable east coast conditions saw re-stockers provide a boost to the WA market, with record numbers of sheep heading east across the Nullarbor.
Despite the uncertainty the COVID-10 pandemic created around the labour market, access to key inputs and commodity prices, broadacre growers and livestock producers have pleasingly been able to grow and harvest their crops and sell their stock at generally good prices.
In the absence of backpackers, hordes of family and friends dusted off their boots and answered the call to return to the farm to work peak periods, which made for many fantastic multi-generational family paddock photos across the Twittersphere!
Record low interest rates continued to be enjoyed, widespread grower competition saw land and lease prices increase, and mid-term commodity price concerns emerged late in the year as agriculture bore the brunt of diplomatic tensions between Australia and China.
Economic conditions changed remarkably in the shadow of COVID-19, seeing the RBA lower the target cash rate from 075% to a record low 0.10%, purchase $100 billion of five-to-10-year government bonds and allow banks to borrow at 0.10% to fund business and household loans.
Between January and December, key economic indicators deteriorated, with economic growth from 1.7% to -3.8%, inflation from 1.7% to 0.7%, and unemployment from 5.2% to >7%, despite the Job Keeper stimulus.
Aussie growth watched AUD forecasts as Donald Trump defied the polls to accumulate more votes than any candidate in prior US election history - but only the second most votes in the 2020 election - becoming a one-termer as Biden took the White House.
Articles (and key points) include:
Farmanco 2020 Profit Series Overview, by Greg Easton
Update on harvest weed seed control tools, by David Cameron
A large part of the cost of Harvest Weed Seed Control (HWSC) is associated with the nutrient loss or distribution.
The harvester mounted mill solutions are becoming more affordable.
There are mills accepting lower levels of control and providing cost and operational benefits.
Oil and its relationship to grain prices, by Don McTaggart
Strong correlation between crude oil and grain futures doesn’t appear to translate to local prices.
Budget Prices 2021 – WA, NSW, Vic, and SA