Agricultural commodities: March quarter 2016

Overview 
 This report contains ABARES' latest outlook to 2020-21 for Australia's major agricultural commodities. In addition, this publication includes articles titled: • Farm performance: broadacre and dairy farms, 2013-14 to 2015-16 
• Productivity in Australian broadacre and dairy industries 
• Disaggregating farm performance statistics by size. 
 A limited number of printed copies will be available by contacting info.abares@agriculture.gov.au 

Key Issues 
 Commodity outlook  
• The gross value of farm production is forecast to increase by 2.7 per cent to around $60.3 billion in 2016-17, following a forecast increase of 9.3 per cent to $58.7 billion in 2015-16. 
• The gross value of livestock production is forecast to increase by around 1.8 per cent to $30.8 billion in 2016-17, following a forecast increase of 13.3 per cent in 2015-16. The gross value of crop production is forecast to increase by 3.7 per cent to $29.5 billion in 2016-17, after a forecast increase of 5.3 per cent in 2015-16. 
• In 2020-21, the gross value of farm production is projected to be $58.5 billion (in 2015-16 dollars), 11 per cent higher than the average of $52.6 billion over the five years to 2014-15 in real terms. The gross value of crop production is projected to be $28.0 billion and the gross value of livestock production is projected to reach $30.4 billion (all in 2015-16 dollars). 
• Export earnings from farm commodities are forecast to be around $45.0 billion in 2016-17, slightly lower than the forecast $45.2 billion in 2015-16. 
• The agricultural commodities for which export earnings are forecast to rise in 2016-17 are wool (up 7 per cent), dairy products (4 per cent), sugar (7 per cent), live feeder/slaughter cattle (9 per cent), cotton (22 per cent) and canola (13 per cent). 
• Forecast increases in 2016-17 are expected to be more than offset by expected declines in export earnings for beef and veal (down 4 per cent), wheat (1 per cent), lamb (3 per cent) and mutton (11 per cent). 
• In 2020-21 the value of farm exports is projected to be around $45.3 billion (in 2015-16 dollars), 11 per cent higher than the average of $40.7 billion over the five years to 2014-15 in real terms. 
• Export earnings for fisheries products are forecast to stay at around $1.7 billion in 2016-17, after increasing by a forecast 15.6 per cent in 2015-16. 

 Economic assumptions underlying the commodity outlook  
• World economic activity is forecast to increase by 3.2 per cent in 2016 and 3.4 per cent in 2017. World economic growth is expected to rise further to around 3.7 per cent in 2018 and 2019 before falling to 3.5 per cent in 2020 and 2021. 
• In Australia, economic growth is assumed to average 2.5 per cent in 2015-16, and 2.8 per cent in 2016-17. Toward 2020-21, economic growth is assumed to average around 2.7 per cent. 
• The Australian dollar is assumed to average around US71 cents in both 2015-16 and 2016-17. It is assumed to gradually appreciate over the medium term, reaching US74 cents towards 2020-21. 


Tags: AGRICULTURE, AGRICULTURE Crops, AGRICULTURE Livestock, AGRICULTURE statistics, Australian, FISHERIES, FISHERIES production, FISHERIES statistics, FORESTS, FORESTS production, FORESTS statistics, Farming, INDUSTRY, INDUSTRY Primary, INDUSTRY Primary statistics, March, agriculture, commodities, crop, farm performance, fisheries, forestry, horticulture, livestock, productivity, rural
Organization: Australian Bureau of Agricultural and Resource Economics and Sciences