Latest reports from ABARES* estimate agricultural export earnings to fall by 5% in 2019-20, despite some improvements in seasonal conditions.
According to the agency's latest Agricultural Commodities report the decline in overall export earnings is driven by a reduced value of livestock exports, including for beef and veal, wool, lamb mutton and live feeder cattle.
Export earnings from crops are set to increase slightly by 3% in 2019-20 on the back of an increase in the value of wheat exports (up 24%), and also barley, sugar, canola, chickpeas and wine. However, earnings from cotton are forecast to fall by $1.7 billion (see below for details).
According to estimates in the June edition of ABARE’s Australian Crop Report, the unusually dry conditions in the 2018-19 summer period led to a fall in the Australian crop production by around 35% to 2.6 million tonnes, which was driven by cotton (down 54%) and rice (down 91%).
Throughout autumn, this was then followed by drier than average seasonal conditions across most cropping regions in Western Australia, northern New South Wales and southern Queensland. For these areas sufficient and timely rainfall will now be important for a recovery in crop development, it says.
Other parts of the country, including many regions across South Australia, Victoria and southern New South Wales, had above average rainfalls in autumn, and therefore have a more positive outlook for their winter crop production.
The report forecasts that total winter crop production will still increase by around 20% from 2018-19, a season that was adversely affected by frosts and drier than average seasonal conditions across many cropping areas.
However, the 2019-20 crop yield is set to be around 10% below the 10 year average.
ABARE’s forest and wood product statistics for the September and December quarters 2018 shows that despite a small decline in volume of logs harvested from commercial plantations in 2017-18, their total value was at a record high of $2.7 billion, up 4 per cent from 2016–17. This increase was driven by values of hardwood and softwood commercial plantation harvests.
Commercial plantation logs make up 87% of Australia’s total log harvest.
The strong result is underpinned by increased export demand, especially for wood chips and roundwood logs, which continued in the first half of 2018-19 and contributed to an overall rise in export value of 10% from the same period in 2017-18. Import values of wood products also increased during that period by 14%, reflecting a broadly higher consumption of wood products.
However, wood processing output decreased slightly in 2017-18.