Optimistic ag making the most of a good crisis

Coronavirus crisis yields plenty of good news for 'match fit' agriculture

Agribusiness
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Agribusiness has rushed to adjust and adopt upbeat initiatives while coronavirus-hit confidence in much of the remaining economy is at all time lows

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Farmers spend their lives keenly watching the rural radar for seasonal and market opportunities, a focus which has been working overtime in recent months as they adapt to make the most of the global coronavirus crisis.

Like young Norm in Bob Hudson's quirky 1970s hit, The Newcastle Song, agribusiness has seized the moment to "never let a chance go by".

Buoyed by its "essential services" status, plus demand spikes for food and long-awaited good rain in many regions, agriculture has rushed to adjust and adopt upbeat initiatives while confidence in much of the remaining economy hits all time lows because of COVID-19 isolation rules, business closures and travel bans.

"Agriculture hasn't missed a beat, in fact coronavirus has actually galvanized the industry into making a big effort to bounce back from drought," said Westpac's agribusiness general manager Steve Hannan.

"Yes, it is a good time to be in agri-banking.

"It's amazing to see how quickly farmers and farm industries adapted to the new situation and how supply lines have stayed open."

Dealing with tough decisions, whether they be financial, seasonal, biosecurity or market related is pretty much part of agriculture's DNA - Steve Hannan, Westpac

Mr Hannan said producers and businesses such as abattoirs, saleyards and farm service providers were not just early adopters of quarantine initiatives, they were "match fit" to handle the challenge of sudden change in business rules and demand priorities.

Years of drought and a generally strong understanding of how to do more with less had prepared Australia's farm sector mindset to be ready for risks.

By early March the whole industry had responded relatively smoothly with a swift swing to more electronic marketing, social distancing and biosecurity-styled health and movement protocols for workers on farms, feedlots and in the processing supply chain.

Online livestock judging competitions even emerged to replace that most iconic of rural events, the country show, and Sydney's big Royal Easter Show.

In April feedback to an Australian Community Media national survey found few farmers expected widespread economic setbacks to their own income this year, with more than 60 per cent believing it could rise.

Cheaper fuel, tax incentives

Also helping to keep farmers feeling positive and proactive has been a 20pc fall in fuel costs (conveniently prior to sowing season) and investment incentives on new machinery and equipment announced in Canberra's economic stimulus response to the pandemic emergency.

Steve Hannan

Steve Hannan

"Dealing with tough decisions, whether they be financial, seasonal, biosecurity or market related - and the logic of how to handle them - is pretty much part of agriculture's DNA," Mr Hannan said.

"People are in a rhythm that has been able to embrace the COVID pressures including demand for food - and the seasonal opportunities - with a much less disrupted logic than that experienced by many other businesses or city workers."

He noted a rush of interest in upgrading equipment to cash in on pre-June 30 tax depreciation opportunities, and an uptake in farm equipment finance products leaping to double digit growth for Westpac.

Some machinery dealers and farm engineering companies were now flat out keeping up with new orders.

"The consistent view is the good fundamentals for agriculture are not going to change in Australia," Mr Hannan said.

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Optimism has also played out in parts of the rural media, with ACM (the publisher of Farmonline) adapting to the COVID-19 environment.

Agricultural commercial director Craig Chapman said while the global pandemic had hit the wider media sector generally, ACM's agricultural publications had still achieved strong editorial and sales results, despite the disruption.

We've tried to work out what marketing strategies customers need in this environment and adapt our offerings to meet that - Craig Chapman, Australian Community Media

"By working with our editorial teams we've been able to offer some really unique opportunities such as the online beef cattle show Beef Battle hosted by theland.com.au," he said.

"Live judging of that competition attracted 11,772 views in its first four days."

That tally later exceeded 17,782 views from 50 countries, plus more than 24,100 views on Facebook's livestream across ACM mastheads.

Craig Chapman

Craig Chapman

"We've tried to work out what marketing strategies customers need in this environment and adapt our offerings to meet that," Mr Chapman said.

"It is a difficult time for some, but certainly other clients have been able to benefit, so it's a matter of tailoring our sales approach to suit both."

Popular property

Rural property marketing is one sector where business has been significantly disrupted by travel and inspection restrictions, yet has also remained surprisingly robust.

The Ray White agency group made an early decision to continue its property selling program via centralised video auctions, with one of its early post-lockdown sale events, based on Mundubbera in Queensland, selling all 13 properties offered and attracting 120 bidders.

"The vendors were happy, we were quite surprised at how well it went, and I'm impressed how quickly online selling has been accepted since," said Ray White Rural and Livestock managing director Stephen Nell.

"I think it will be commonplace in future to have traditional auctions running in tandem with buyers bidding via video."

Long-time digital auction specialist AuctionsPlus has also added property to its sale platform, which in the past month has expanded to include joint interface coverage of regional store cattle sales at Yea and Mortlake in Victoria, Yass in NSW and Boyunup in WA, and the wool market.

Online wool auctions were launched partly as an insurance strategy for brokers fearful coronavirus restrictions may have tightened to stop all physical auction room activity.

Online markets boom

COVID-19 travel limitations and the seasonal upturn have proven a boon for the online marketing portal which listed 264,000 cattle for sale from vendor's properties in the first four months of this year compared to 150,000 in the same time last year.

That's more than half the total number of cattle offered on AuctionsPlus during 2019.

Traditional autumn selling events such as weaner sales were among those reassigning numbers to internet sales so bidders across eastern Australia could take part without leaving home.

Sheep listings also surged to 1.3m so far this year - up from 1m head offered until April 30 last year, and equivalent to almost half 2019's total offering.

"A lot of activity has been driven by a very hungry restocker market after February rain because producers now have grass but few stock emerging from those drought years," said AuctionsPlus chief executive officer Angus Street, who has been recruiting extra staff to help handle the new work.

"We've had stud owners who never previously considered using AuctionsPlus suddenly moving their annual bull sales online and now saying it will change how they run their sales forever."

Aussie farmers just seem to keep grinding ahead with the task of getting their job done - Angus Street, AuctionsPlus

Stud stock manager with the Grant Daniel and Long agency group Harvey Weyman-Jones said the coronavirus lockdown had shown breeders locally and internationally "we can do high quality online sales, with all the bells and whistles" and get big prices, good clearances and draw bids from around the globe.

Harvey Weyman-Jones

Harvey Weyman-Jones

In March, as interstate travel was halted, GDL had to hastily switch a South Australian on-property Wagyu sale to an auction run from its office in Dalby, Queensland, including pre-recorded video and genetic data accompanying each sale lot.

The success of that event, where 30 lots grossed $1.3m and a semen straw made a world record $68,000, was followed by a similar online move for the annual Australian Elite Wagyu Sale with one of the vendors from Canada.

"The technical and connectivity challenges which you probably expected five years ago aren't really too problematic now and people find they are much more comfortable buying and selling online once they've tried the experience," Mr Weyman-Jones said.

AuctionsPlus' Mr Street agreed, saying the impact of COVID-19 on events like the stud selling season had potential to become really costly and polarising, but instead ag had "accepted the switch to online as just a speedbump".

"There's been a determination to make things work.

"Aussie farmers just seem to keep grinding ahead with the task of getting their job done."

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The story Optimistic ag making the most of a good crisis first appeared on Farm Online.

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