Now in its fourth year, National Ag Day is a day for all of us to recognise the contributions farmers and regional communities make to our economy and social fabric.
Of all the major disruptions that the farming sector has navigated over the past few years, none has been like this year. First the lingering effects of a debilitating drought, then the devastating bushfires earlier in the year, and, most recently, the global pandemic.
In my role as the leader of our Regional and Agribusiness Banking team at Commonwealth Bank, I see and hear about these impacts first-hand. I also get to hear the human stories of resilience, of courage, of care and the commitment of Australian farmers to their industry, their livelihoods, their families and their communities.
And as much as they have done it tough, I am also constantly inspired by the examples of adaptability, of change and the new, innovative approaches that are happening every day across the different sectors that make up our industry.
This innovative spirit has shone through over the past few months. Not only have the customers I have spoken to protected themselves against some of the global market challenges, more importantly they’ve also been embracing new opportunities. They’ve adapted their business models to meet changing market demand and consumer preferences.
With a focus on food security and supermarket shortages this year due to the coronavirus and trade issues, a light has shone on agriculture’s status as one of the most critical pillars of our economy. Throughout 2020, farmers have worked hard to deliver our food and fibre in new ways. They’ve kept our supermarkets stocked with fresh produce, our people fed and our economy going.
And it’s been positive to see so many agribusinesses turn a corner and enter a period of expansion. We’ve seen successful winter crops in many regions, and strong optimism about yields and quality of harvest ahead.
Farmer confidence is at an all-time high – nationally, farm values are up, commodity prices are holding firm, interest rates are at record lows, seasonal conditions have been good, there is strong consumer and retail demand for fresh produce, and there’s Government incentives like the instant asset write off scheme.
All of this is spurring investment in the sector.
Over the past few months we’ve seen asset financing in the sector increase dramatically – largely driven by farmers purchasing agricultural machinery for this year’s crop season. Across the country, new asset financing for tractors is up 119 per cent – the highest volumes we’ve seen in the past three years – and financing for harvesters is also up, by 108 per cent.
This confidence is good for everyone; for the regional towns where the farms are located, for the whole supply chains that support our farmers, for the markets they sell to, and for the rest of us who enjoy fresh Australian produce.