Slaughter of cattle and sheep remains within the range observed over the past 20 years and prices remain high by historical standards. It is likely that overall cattle and sheep numbers will decline as a result of this drought, however these are likely to increase shortly thereafter, as in previous droughts.
Relatively little change in livestock markets despite a period of limited pasture growth suggests that many livestock producers in south-eastern Australia have so far opted to use supplementary feed to balance energy requirements, rather than selling stock for slaughter.
Continue reading “Livestock markets are operating within the bounds of historical variation”
Climate effects are currently severe but farm incomes are likely to be less affected than in previous droughts
ABARES estimates the effect of climate on farm cash income (holding all other factors constant) is among the worst two years since 1978, comparable only to the 2002-03 drought. However, farmer incomes are likely to decline by substantially less than in previous droughts, as comparable poor climate effects are being buffered, or offset to some extent, by more favourable economic circumstances and other factors.
Continue reading “Climate effects are currently severe but farm incomes are likely to be less affected than in previous droughts”
On-farm stocks of feed and fodder in south-Eastern Australia were relatively high going into the drought, and prices of hay and feed grain were relatively low. However, as poor conditions have continued, prices have increased rapidly, and are now approaching levels observed during the 2006-07 drought. Continue reading “On-farm stocks of feed and fodder were relatively high going into the drought”
While attention is focused on responding to the current situation, it is important to understand the wider context – and tensions – around drought policy and climate change. Most importantly, while supporting those in need is appropriate, there is a risk that some interventions intended to assist farmers during droughts can have negative consequences in the longer term. Continue reading “Drought policy is complicated and there are inevitable trade-offs”
The current drought conditions are severe in some regions – particularly in NSW. Rainfall to the end of September 2018 in NSW is the 3rd lowest ever recorded at 190.9mm. Rainfall to date across Australia is as poor as any period in the last 20 years. However, the extent of rainfall deficiencies is currently smaller than in previous droughts. Continue reading “The current drought is severe in some regions but covers a smaller area than previous events”