Rabobank

Rising input costs combined with fears of a foot and mouth disease incursion have weighed heavily on optimism in Australia’s farm sector in the latest quarter, according to the Rabobank Rural Confidence survey. Despite extraordinary strength in farm balance sheets and the overall health of the sector following more than two years of high rainfall and exceptional commodity prices, more farmers now believe conditions are set to worsen over the year ahead rather than improve.

Global dairy market fundamentals have shifted course in Q3 2022, from extreme tightness to visible but modest loosening. A  potential collision between supply growth and demand is  approaching, with Q4 year-on-year milk supply growth, weak Chinese import demand, and broader demand rationing in developing countries weighing on forecasts, according to the latest international dairy market report from Rabobank.

I have spent more than a year counting banks. It’s not an introduction to a story I could have foreseen myself writing 12 months earlier but when News Corp started cutting jobs in the rural mastheads, I found myself with time on my hands and a lot of unfinished business ... The “big four” (ANZ, Commonwealth, NAB and Westpac) started pulling out of regional Australia more than 30 years ago and one of the obstacles to reporting on this has been that there still isn’t a clear picture of the scale of closures.

Casterton, Grenfell, Home Hill, Nathalia and Toukley. Five Australian towns that were until recently set apart by one dubious achievement shared by no others: they had all lost a full hand of the “big four” banks – ANZ, Commonwealth, NAB and Westpac – since the 1970s. The days when all four branches were still open in these places was a time when banks were major employers in a town and the managers treated like kings because of the power they then had to make decisions locally that could make or break a business.

Global demand for cheaper cuts of beef is expected to increase in the year ahead as rampant inflation and slowing economic growth see consumers trade down, Rabobank says in a newly-released report. And Australia - as one of the largest exporters of beef "trimmings" (the cheaper meat cuts which remain after prime cuts are removed) - is expected to be among the best-positioned countries to benefit from this increased international demand, particularly from the US, the agribusiness bank says in its Q3 Global Beef Quarterly.

Australia's beef and sheepmeat sectors can expect continuing demand from China despite its slowing economy and continued lockdowns impacting how the country consumes animal proteins. Speaking on a newly-released podcast, Is the Chinese meat market still firing?, Rabobank's Hong Kong-based senior animal protein analyst Chenjun Pan said China's lockdown policies have affected the population's protein consumption habits, with the major short-term change being where people are consuming food.

The latest quarterly Consumer Price Index (CPI) data, has shown a continuing rise in Australian food price inflation, with June 2022 quarter food prices increasing 5.9 per cent compared with the June quarter last year. Rabobank senior food retail analyst Michael Harvey said this was the highest year-on-year increase seen in food prices in the CPI since the September quarter 2011, when yearly food price inflation had peaked at 6.4 per cent.

Many Australian farmers are still battling to get grain crops planted due to wet conditions, while the global wheat outlook price remains elevated and buyers will be hoping prices will ease as the northern hemisphere supply comes to market.

Australia will need to both consume and export more avocados as the nation’s growers navigate a period of soaring production growth over the coming five years, specialist agribusiness bank Rabobank says in a new report. This year alone, ‘per capita (person) supply’ of avocados is estimated to be up 26 per cent on the previous 12 months to 4.8 kilogram – equating to 22 avocados per Australian.

Australia’s agricultural sector can expect to contend with elevated ocean container shipping costs and ongoing supply disruptions for at least another year before a ‘normalisation’ of the global ocean freight system, according to new research from Rabobank.