Optimism about the agricultural sector going forward has risen among SA farmers, according to Rabobank’s final Rural Confidence Survey that was released today.
After falling substantially last quarter, the survey showed tentative signs of morale recovery, finding the state’s farmers are finishing the year on a more positive note.
Completed in November, it showed the percentage of SA farmers holding an optimistic view had risen to 31 per cent, up from 13pc last quarter.
The proportion of the state’s farmers holding a negative outlook remained high at 45pc but was down from 59pc with that view in the previous survey.
Those expecting similar conditions to last year stood at 22pc.
Rabobank regional manager for SA Roger Matthews said the improved outlook particularly reflected positive market conditions for sheep graziers as well as a greater level of certainty for grain growers, with the season essentially completed and harvest underway.
“With the season largely completed, growers are more confident now that they know where they stand, and for the most part this has been a fairly positive finish,” he said.
The upswing in confidence this quarter was led by the state’s sheep graziers, with sentiment in the sector lifting strongly – 35pc expecting agricultural economic conditions to improve, up from 24pc in the previous quarter and the number with a negative outlook falling to 25pc, compared with 43pc previously.
A total of 37pc had a stable outlook on the year ahead.
Mr Matthews said despite some softening in commodity prices, the state’s sheep producers remained on solid ground.
“At this time of year, we do tend to see sheepmeat prices pull back a bit with the abundance of spring lamb, but the drought seen in eastern states is keeping supply tight and the bank’s RaboResearch analysts are expecting prices to remain above five-year averages,” he said.
Confidence also lifted somewhat in the grains sector with 31pc now indicating a positive outlook, an improvement on the 15pc with that view last quarter.
Mr Matthews said while the forecast was for the state’s winter crop to be down by 16pc on last year, in some regions crops were yielding better than had been anticipated.
“On the Eyre Peninsula, things are largely looking really positive,” he said.
“While they did have a dry start, growers received decent falls in August and all, except a small pocket at the top of the region, seem to be boasting crops of either average or aboveaverage yields.
“For those who have suffered yield loss due to dry conditions or because of this year’s frost, tight domestic supply has offered prices that have gone a long way to help alleviate the pain of fewer tonnes.”
Dairy and beef producers remained more subdued in their outlook with those anticipating worsening conditions sitting at 65pc and 62pc, respectively.
This quarter, the survey also questioned farmers about their ability to prepare for and manage drought conditions.
It found 96pc of SA producers surveyed felt either somewhat or very prepared to handle drought.
Farmers also indicated their ability to manage drought had improved in recent years, with 54pc saying their businesses were better prepared for drought now than five years ago.
Mr Matthews said SA agriculture had been fortunate to have had a succession of really strong years, helping to build the resilience of the sector.
It found 96pc of SA producers surveyed felt either somewhat or very prepared to handle drought.
