Agriculture continues to face the challenges of adverse weather conditions and elevated input costs, in Australia and globally. Such risks are driving grain markets higher, though most growers remain focused on sowing at present. Livestock prices slipped over the last month on the back of drier weather conditions, though a smaller national flock is limiting further downside to lamb and mutton prices. Demand for Australian wool remains robust, while cost-conscious shopping behaviour here at home may partially limit the rise of dairy retail prices.
Ag sector outlook
- Cattle: In the short term, low-cost beef from Brazil will continue to displace Australian product in key markets and maintain a ceiling for local prices.
- Horticulture: With autumn now nearing the halfway point, a shift away from late summer produce towards winter varieties is well underway.
- Cropping: Local and offshore crop risk added to April price strength, with northern markets and eastern feed barley leading domestic gains. Canola rebounded into May on broader oilseed support and tight old-crop availability.
- Dairy: An overall steady farmgate milk price and cost-conscious consumer shopping behaviour will likely limit how high dairy retail prices rise. Notable increases may be drawn out through the 2026/27 season.
- Sheep: While the dry seasonal outlook is a reminder of the 2023 season, the reduction in the national flock and improved processor capacity should limit the potential price downside.
- Wool: While the market is facing currency related headwinds in the immediate term, desire for sustainable, natural fibres is helping to underpin strong price growth this season.
- Carbon and climate: Emissions intensity is likely to become a larger focus for producers as large companies look to manage their scope three emissions in line with their reporting requirements. Improving production efficiency is a useful tool to improve emissions intensity, as well as increase overall profitability.
Bendigo Bank Agribusiness Insights publication(s) are for information purposes only and contain unsolicited general information, without regard to any individual objectives, financial situation or needs. Please refer to the terms and conditions.
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