Farmers are feeling slightly more optimistic compared to last year, despite struggles with high interest rates, poor commodity prices, and excessive bureaucracy, according to the latest Farm Confidence Survey by Federated Farmers. The survey, which has been running for 15 years, showed that rural confidence hit an all-time low in 2023. However, there has been a slight improvement in the mood of farmers since then.
Federated Farmers national president, Wayne Langford, said that while farmers are not yet confident, they are feeling less unconfident. He explained that high inflation, high interest rates, and lower commodity prices have impacted farmers’ profitability. However, there is a sense of cautious optimism as more farmers expect their circumstances to improve in the next year.
The survey conducted in January 2024 shows that more farmers expect their production and spending to increase, and fewer expect their debt to increase in the coming year, compared to the survey in July 2023. Langford attributes this recovery in confidence to slowing inflation, stabilized dairy commodity prices, and the new government’s commitment to reduce impractical and expensive regulations.
Farmers’ main concerns currently include debt, interest rates, commodity prices, regulation costs, and climate change policy. Langford has called for an independent inquiry into rural banking to understand why interest rates for rural lending have increased significantly compared to residential lending.
Despite the slight increase in confidence, Langford acknowledges that times are still tough for farmers and encourages those who are struggling to seek support from organizations like Federated Farmers and Rural Support Trust.
Key points from the January 2024 Federated Farmers Farm Confidence Survey include:
– 55% of respondents consider current economic conditions to be bad, a 25-point improvement from July 2023.
– 0.9% of respondents expect general economic conditions to improve over the next 12 months, a 71-point improvement from July 2023.
– 3.1% of respondents report making a loss currently, a 4.9-point worsening from July 2023.
– 21% of respondents expect their profitability to decline over the next 12 months, a 49-point improvement from July 2023.
– 6.0% of respondents expect their production to increase over the next 12 months, a 13.5-point improvement from July 2023.
– 4.0% of respondents expect their spending to increase over the next 12 months, a 15-point improvement from July 2023.
– 0.3% of respondents expect their debt to increase over the next 12 months, down 14 points from July 2023.
– 23% of respondents reported it has been harder to recruit skilled and motivated staff over the past six months, down 9 points from July 2023.
– The four greatest concerns for farmers are Debt, Interest & Banks; Farmgate & Commodity Prices; Regulation & Compliance Costs; and Climate Change Policy & ETS.
– The four highest priorities farmers want the Government to address are Fiscal Policy; Economy & Business Environment; Regulation & Compliance Costs; and Monetary Policy.
