Market prices fail to keep up with rising costs
A RECENT study has found returns for farmers remained unchanged this year, but the region’s growers are feeling the pinch.
The ABARES findings showed the average income for vegetable growers remained steady.
This steady income was thanks to higher market prices, despite growers forking out more for increased irrigation and production costs.
But Glenore Grove farmer Brett Simon hasn’t witnessed a bump in produce prices.
“I haven’t seen an increase – not for the amount of work you’re putting into it,” Mr Simon said.
“(The work) doesn’t really reflect in the price that you’re receiving back.”
The vegetable farmer grows broccolini in the winter and shallots year-round on 113ha (280 acres) of farmland.
While the winter season wasn’t too bad for Mr Simon, with yields roughly the same as last year’s, he has never seen the conditions this dry leading into summer.
“We usually get the odd storm, just a shower even or cool, cloudy days but there’s been nothing,” he said.
“It’s just been relentlessly hot, sunny and dry.”
He said as market prices were not rising, the increased costs due to the continuing drought were eating into the farm’s returns – extra water usage the biggest bill.
“You have to water grounds and get it wet before you plant,” Mr Simon said.
“Plus if you water more, you’ve got to fertilise more because the fertiliser leaches out of the ground. That’s an extra cost there as well.”
Despite the tough summer season ahead, Mr Simon said his farmland was in a lucky position and would be able to continue with production unchanged.
“We’ve got good farms down here – we’re fortunate with water, so we’ll just keep going,” he said.
National average holds steady
According to the ABARES data, the average farm cash income of an Australian vegetable grower remained largely unchanged at an estimated $253,000.
ABARES Acting Executive Director Peter Gooday said the Australian vegetable-growing farms: an economic survey 2017–18 and 2018–19 revealed the average rate of return for Australian vegetable growing farms is estimated to have remained steady at 3.9 per cent.
Rates of return were above average in all states except Queensland, with
South Australia estimated to have had the highest average rate of return, followed by Victoria and Tasmania.
“The survey found that total vegetable receipts increased slightly in 2018–19 but were offset by higher cash costs, particularly hired labour and contracts,” Mr Gooday said.
“The financial performance of farms across the sector is heavily influenced by seasonal conditions.”
ABARES has conducted the annual survey of vegetable-growing businesses since 2007 to inform industry and government about farm-level production, and provide a financial overview of the industry.