Australian agriculture’s record-breaking run is set to dry up, with winter crop production to plunge more than a third while overall production is also forecast to fall.
The latest quarterly outlook has been released by ABARES, the agency responsible for agricultural science and economic research.
It predicts agricultural production will drop by 14 percent to $79 billion (US$52 billion)after three consecutive record years.
“We’re expecting agricultural production to pull back from what has been a peak for quite some time, last year where we reached close to $92 billion,” ABARES executive director Jared Greenville told AAP.
“It’s largely being driven by a reversion to a more average to below-average yield, particularly across our winter cropping,” he said.
While it’s been a mixed start to the cropping season, Dr Greenville said production is still expected to hit 44.9 million tonnes and will be the sixth largest ever.
One of the key drivers for the lower crop yields is the latest seasonal outlooks which expect drier conditions ahead.
The lower yields will also see exports drop significantly, while inflation is also eating into producers’ profits and affecting consumer demand.
A spike in mouse activity has had an impact as well, with growers undertaking more baiting.
The quarterly cropping outlook shows wheat production will fall 34 percent, slightly below the 10-year average, with barley to fall 30 percent and canola 41 percent.
Summer crop production is also expected to fall from record highs while remaining above the 10-year average.
It’s not the same story across all industries.
Horticulture is expected to increase $1.5 billion to a record $18 billion, driven by strong growth in nut production and increased demand for locally grown fruit and vegetables.
Dr Greenville said the wine industry would also rebound from a challenging year, with drier conditions reducing the risk of disease.
The results were mixed for the livestock sector, with slight increases in production across beef, sheep and milk but a drop in the value of livestock production because of lower prices.
“This is down to a number of factors, such as less demand for restocking, and like crops, we expect global production to pick up,” Greenville said.
The agency expects strong growth for wool, with Chinese demand driving higher prices.
The forecast decline in overall agricultural production has prompted a warning from one farming group, with the Victorian Farmers Federation urging its members to prepare for drier conditions.
“Farming is cyclical, and the best preparation for the tough times is done when the going is good. That time is now, and there’s no time to waste,” said the group’s Emma Germano.
“For drier times, that means prioritising drought preparedness, sustainability, resilience and risk management for farming businesses and communities well ahead of when drought strikes.”
