Despite growing volatility posed by Brexit, US-China trade disputes, EU free trade negotiations and predictions of a deepening global slowdown, there is cause for growers to feel moderately upbeat about the economic future.
Compiled by Rural Bank’s Ag Answers insights division and released last week, the Australian Agriculture Outlook predicts the value of horticultural exports will rise in 2019.
Helped along by a lower Australian dollar and China’s strong demand for agricultural products, fruit exports are likely to continue to rise in 2019. Rural Bank predict a 10 per cent increase for fruit exports, strongly linked to growing citrus, stone fruit and cherry exports to China and Hong Kong.
With respect to apples and pears, negotiations for Australian apple access into China are reported by DAWR to progress steadily and will presumably inflate this export figure higher still in future years, once granted.
Domestically there is also good news for broader horticulture with a trend towards higher local fruit consumption likely to have a positive impact on price. Given the flat or even declining sales of pome fruit in recent years, it is unclear if these broader benefits will flow through to apple and pear growers.
The report also cautions that the Federal election may contribute to increased uncertainty as changes to policy, including negative gearing and capital gains tax concessions are considered.
Similarly, tightening in lending standards could conceivably spread from the housing market to SMEs and agribusiness in the wake of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
Overall, Rural Bank predicts ‘a good season’ characterised by strong rainfall will determine the agricultural sector’s ability to support strong price and production.