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Australian farmers across all sectors are looking to invest in infrastructure in the short term. Beef, cotton and dairy farmers are the most likely to be allocating more infrastructure budget this year, according to data released today by Commonwealth Bank.
Data from Commonwealth Bank’s Agri Insights research program shows that while investment intentions are generally positive across the key sectors of the Australian market, specific investment plans vary by commodity type.
Darryl Mohr, Commonwealth Bank’s General Manager, Regional and Agribusiness Banking for Victoria and Tasmania, says the latest results reflect a sound agribusiness sector however there are some competing priorities for different segments.
“Seasonal and market conditions are naturally going to have an impact on investment intentions, but what we are seeing is that producers in the beef sector were the most likely to be planning infrastructure investment. We’re also seeing a big upswing in infrastructure investment intentions in cotton, where we have seen some improved conditions, while dairy operators indicated they were also looking at infrastructure,” Mr Mohr said.
In the beef sector, 39 per cent of producers say they’ll spend more on infrastructure, compared to 37 per cent in cotton and 30 per cent in dairy.
The sugar sector is the only one where infrastructure is not the most commonly cited area for increased investment. In this sector, technology is the key investment focus, although overall investment intentions are not as strong in sugar as in some other commodities. In sugar, 12 per cent of growers say they will invest in infrastructure but 14 per cent say they will invest in technology.
“Technology investment intentions are fairly solid across the board,” Mr Mohr said. “In particular, grain and dairy producers are especially keen to boost technology spending. Auto steer is a big area of technology investment growth for grain producers, while software is high on the wish list for dairy operators.”
One in four grain growers (26 per cent) say they will invest more in technology, while 24 per cent of dairy producers will increase tech spending.
Employment intentions are also positive across most sectors. Cotton growers are most likely to be planning to hire more staff (13 per cent), followed by horticulture producers (nine per cent) and dairy farmers (seven per cent).
“The survey results indicate that dairy farmers are particularly interested in specialist advice and sourcing staff to help them in their operations, but they’re also most likely to be winding back their own involvement. Dairy farmers are far more likely than those in other commodity sectors to say they’ll increase the use of consultants, which reflects their strong interest in carefully managing operations to maximise productivity.”
Dairy and horticulture producers are also top of the list of those most likely to increase the use of contractors, while beef and grain producers are most likely to be planning to diversify into off-farm investments.
The data has been released ahead of the Farm World field days in Victoria, of which Commonwealth Bank is a key event partner.