Drought

Following fires and drought, the covid-19 pandemic presented a new challenge for Australia’s farmers, but financial returns for investors have remained steady and attractive.

Fundamental shifts in supply and demand, with increased plantings of permanent horticulture, will increase reliance on carry-over water and inter-valley trades.

A combination of factors led JBS to close a processing facility in Queensland this week in a sign of the challenges that Australia’s beef exporters are set to face in the coming months.

Regulatory risk and climatic conditions are the culprits behind a drop in the value of water entitlements in the southern MDB, the first in four years.

Federal report finds water inflows to the MDB have reduced because of climate change, leading to a decline in the reliability of general security water entitlements in some parts of the system.

The NCREIF Australian Farmland Index, which is heavily weighted to permanent cropping, shows total returns held up fairly well despite drought across much of eastern and northern Australia.

With drought leading to record-high water prices in south-east Australia last year, investors have started to look north in search of returns – but there are huge barriers to overcome. Daniel Kemp investigates what efforts are being made to unlock the opportunities.

Data analyzed by Digital Agriculture Services found that Queensland saw the most agricultural land affected by fire, but timber plantations in New South Wales and Victoria were also hit hard.

Credit Suisse has highlighted the 'perfect margin squeeze' for agribusinesses and primary producers presented by water scarcity but efficiency innovation continues to present investment opportunities.

Interest from institutional investors and private equity remains strong in Australian agriculture despite difficult conditions because of a belief in the asset class’ ‘long-term thesis’.