Farmers borrowed more in the past year while at the same time tucked savings away into their bank accounts.
Bank lending for property sales has risen but jumped 47 per cent for farm machinery and vehicles, according to one of Australia's big four banks, NAB.
A big rural lender, NAB said the demand for equipment finance showed farmers are focused on long-term growth and short-term opportunities, and are investing at a higher rate than the rest of the economy.
The demand for credit across regional and agricultural Australia was up 10.2 per cent nationally and rose 14.6pc for farmers, the bank said.
State by state this borrowing was up 9.6pc in NSW, 4.5pc in NT, 9.2pc in Queensland, 10.8pc in South Australia, 19.8pc in Tasmania, 11.6pc in Victoria and 18.5 pc in Western Australia.
Businesses in regional and rural Australia have prospered in the past year and are well placed to consolidate their gains in the year ahead, NAB's second annual Horizons report shows.
Despite this demand for credit, the bank said agricultural deposit volumes grew by 8.1pc.
Farm Management Deposits were up 35pc in 2022 "with farmers taking advantage of the good times to put something in their bottom drawers".
The bank has crunched the numbers from its 650 NAB regional and agribusiness bankers in more than 120 locations around the nation to produce its bullish report.
NAB executive for regional and agribusiness, Khan Horne, said regional and rural Australia has gone from strength to strength in the past year "and while various challenges lie ahead, the businesses that underpin the regional and rural economy remain well placed to consolidate their gains as they navigate these choppier waters".
Mr Horne said its investigation showed a bright future ahead for farming and regional Australia.
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"It can be difficult to make predictions beyond the next season, but our data shows that regional and rural businesses are equipped with the latest vehicles and machinery, have the right financial instruments in place to weather any downturns, and have made investments that will only continue to yield returns in years to come," he said.
The report detailed the positive influence of the continued exodus of people from the cities to the country.
The NAB said rising interest rates and mortgage stress was "undoubtedly a concern for many homeowners, whether in the capitals, regions or rural areas".
"For regional businesses, which are more likely than metro counterparts to own land and property, interest rates are also a concern.
"Our data is showing that this isn't translating into arrears or defaults, and our conversations indicate that, while homeowners may be making some modifications to their expenses, the interest rate rises are not contributing to a mortgage crisis," the bank said.
NAB is projecting rates to rise again and to start to fall in 2024.
Mr Horne said the report reflects a recovery from a bust-boom cycle of drought years followed by the COVID-19 pandemic.
The report did record the long-range forecast of an El Nino impacting on rain later in the year.
"Our customer insights show strong business sentiment in both regional and rural locations, reflecting optimism for the future and confidence to tackle emerging challenges."
The report said farmland values are set to stabilise in the year ahead after sustained historic levels of growth.
Transactions in the $15 million-$25 million range are likely to be most common, with large-scale family owner-operators again the most active buyers, the bank said.
The same research also shows labour shortages are still top of mind for regional and agribusiness customers.
"Our bankers report that availability of labour is the top concern for regional employers, with wage costs not far behind. Despite the growth in regional populations, the skilled and unskilled farm labour markets remain tight," Mr Horne said.