Australia’s chief commodity forecaster says that for the first time in more than 30 years, primary producers in all states and all industries are projected to return positive farm business profits and rates of returns in 2011-12.

It comes on the heels of news that Australia is also officially drought-free this week, with no exceptional circumstances declarations in place for the first time in more than 10 years.

Reinforcing predictions released at its annual Outlook conference in March, ABARES Australian Farm Survey results, released yesterday, says beef industry incomes and business profits are projected to increase in almost all regions in 2011–12.

This is attributed to above average seasonal conditions, increased cattle prices and a reduction in beef cattle purchases.

ABARES says beef cattle receipts are likely to fall by around 2pc this financial year (due to a reduction in the number of cattle sold), but lower expenditure on beef cattle purchases due to the focus on breeding and reduced expenditure on fodder due to a better season is likely to result in a 10pc decrease in total costs. 

ABARES’s view is that average farm cash income for Australian beef farms (farms that draw most of their income from beef cattle, a category which accounts for 65pc of Aust beef production and contains many small farms) will increase to an average of $67 000 per farm in 2011–12. This would be 6pc higher than the 10 year average.

In southern Australia, New South Wales, Victoria, South Australia, Tasmania and southern Western Australia, where small herd size farms predominate, farm cash income for beef industry farms is projected to increase from an average of $35,400 per farm in 2010–11 to an average of $45,300 per farm in 2011–12.

In Queensland, the Northern Territory and northern Western Australia, where average herd size is much larger than the rest of Australia, farm cash income for beef industry farms is projected to increase from an average of $91,700 per farm in 2010–11 to an average of $107,000 in 2011–12.

However Farm cash incomes for northern businesses reliant upon the live export trade to Indonesia are projected to decline by around 40p, from an average of $519,000 per farm in 2010–11 to around $310,000 per farm in 2011–12.

Beef cattle numbers are expected to increase in almost all regions of both northern and southern Australia, resulting in a further boost to the value of inventories of cattle on farms, the forecast said.