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Higher Incomes for Eastern Grain Farms

10 June 2011
The Australian Bureau of Agricultural and Resource Economics and Sciences

AUSTRALIA - Improved seasonal conditions along with higher grain and oilseed prices are expected to result in an increase in farm cash incomes for grain producing farms in 2010-11, according to ABARES' Australian Grains Financial Performance report.

ABARES Deputy Executive Director, Paul Morris, said that despite challenging seasonal conditions including flooding in some regions, large increases in grain and oilseed production were achieved in New South Wales, Victoria, Queensland and South Australia in 2010â€"11.

"High grain and oilseed prices helped offset the adverse affect that the late season wet conditions had on crop quality," Mr Morris said.

"Nationally, farm cash income for grain producing farms is estimated to average $129,700 a farm in 2010â€"11, which is an increase of around 50 per cent from the previous financial year.

"In contrast to the national situation, the average farm cash income for grain producing farms in Western Australia is estimated to be 11 per cent lower in 2010â€"11 at $92,520 per farm because of more widespread drought conditions in that state."

ABARES farm survey data also shows that grain producing farms increased investment in land and nonâ€"land capital in 2009â€"10 compared with 2008â€"09.

The largest category of new capital expenditure was for harvesting and handling machinery followed by cultivation, sowing, fertiliser and spraying machinery.

"The Australian grains industry has achieved productivity gains above the longâ€"term average for broadacre agriculture," Mr Morris said.

"Between 1977â€"78 and 2008â€"09, cropping specialists and mixed cropâ€"livestock farms achieved average annual total factor productivity growth of 1.9 per cent and 1.4 per cent respectively, compared with the broadacre industry average of 1.3 per cent."

This research was conducted by ABARES and commissioned by the Grains Research & Development Corporation in order to monitor the production and financial performance of grain producers.

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