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Factors affecting agricultural industries in 2011

Changing management practice can be a long and complex process that requires new or expanded knowledge and skills, and sometimes significant capital investment. An agricultural business’ capacity to afford such an investment is typically closely related to climatic and market forces beyond the landholder’s control. Recent challenges for landholders are detailed below.

An historically strong trading position entering 2008 was undermined by above average rainfall from 2008 to 2010. Subsequently, there were many growers unable to take full advantage of good sugar prices and a relatively low Australian dollar. In February 2011 Cyclone Yasi caused severe sugarcane crop damage with the hardest hit areas generally between Tully and Sarina. Crop losses due to Cyclone Yasi reduced the overall value of production. Direct loss of plant and ratoon crops, and inability to harvest and replant due to ongoing wet conditions, will also continue to impact on production in the 2011-2012 year.

The years 2008 to 2010 were generally poor for most fruit and vegetable producers due to very low commodity prices. Bananas were the exception with growers obtaining good prices in 2008-2009 (following the total losses caused by Cyclone Larry in 2006). However, natural disasters continued to challenge horticultural producers in 2010-2011. Cyclone Yasi (February 2011) resulted in significant losses of crops and farm infrastructure, especially for tropical fruit growers north of Mackay. In the Fitzroy and Burnett Mary regions, major wet season flooding brought about losses to production and physical damage to farm land.

Dairy producers in central and northern Queensland experienced generally favourable market and climatic conditions from 2008 to 2010. Good seasonal conditions meant reduced demand for feedgrains and lower feedgrain prices, while milk prices were relatively strong. However, 2010-2011 was quite difficult for most, with wet season flooding and Cyclone Yasi combining to reduce production through feed shortages, loss of power supply and animal health issues. At the same time, sharp discounting of fresh milk prices by major retailers affected the price received by producers.

The 2010-2011 year was generally very poor with most grain growers suffering financial losses due to continued wet weather and flooding. Areas planted to both summer and winter crops were reduced due to the inability to control weeds and to get planting equipment onto the ground. Crops that were planted benefited from good rainfall, but most were lost or downgraded in tonnage and quality due to weather and flood damage.

In 2010-2011, the majority of graziers experienced average or above average rainfall and production conditions, except for frontage properties in areas that experienced livestock and infrastructure losses due to flooding. Cyclone Yasi also caused significant damage to infrastructure. Prices were generally improved on those from the previous three to four years.

Last updated:
27 August, 2014

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