Better seasonal conditions combined with higher grain and oilseed prices are anticipated to lift cash incomes for grain producing farms in 2010-11 a new report released by ABARES says.

According to Australian grains: Financial performance of grain producing farms, 2008-09 to 2010-11, large increases in grain and oilseed production were achieved in New South Wales, Victoria, Queensland and South Australia in 2010-11 despite challenging seasonal conditions including flooding in some regions.

ABARES Deputy Executive Director, Paul Morris, said “High grain and oilseed prices helped offset the adverse affect that the late season wet conditions had on crop quality.

“Nationally, farm cash income for grain producing farms is estimated to average $129,700 a farm in 2010-11, 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 2010-11 at $92,520 per farm because of more widespread drought conditions in that state,” Mr Morris said.

Grain producing farms boost capital

ABARES farm survey data also shows that grain producing farms increased investment in land and non-land capital in 2009-10 compared with 2008-09.

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 long-term average for broadacre agriculture,” Mr Morris said.

“Between 1977-78 and 2008-09, cropping specialists and mixed crop-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.”