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12

2023

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02

Rabobank’s Agribusiness Outlook 2023 of Australia and New Zealand

Source:

Rabobank

Australian agriculture has enjoyed multiple fantastic seasons in a row. Still, 2022 stood out with high, often record, commodity prices and strong, in parts record, production volumes. This has put the farming sector in a healthy position to master 2023, which is likely to deliver good, not record, prices in an environment with elevated costs and a global recession.

 

-Australia: Continuing on a Successful Path

Australian agriculture has enjoyed multiple fantastic seasons in a row. Still, 2022 stood out with high, often record, commodity prices and strong, in parts record, production volumes. This has put the farming sector in a healthy position to master 2023, which is likely to deliver good, not record, prices in an environment with elevated costs and a global recession.

 

Beef: Production is on the rise in 2023, as increased cattle inventory becomes productive. Consumer markets will be softer amid slower economic conditions and prices, while remaining historically high, will retreat from their record levels and stabilise.

 

Sheepmeat: 2023 will see lamb production push further into record territory. Softer consumer demand is likely to impact lamb more as a premium-positioned product but new trade agreements and recovery in China provide possible upside.

 

-New Zealand: Rising to the Challenge

2022 proved to be a particularly difficult year to navigate. The 2023 path may be similarly rocky but we still keep an eye out for opportunities along the trail. New Zealand agriculture is deep in a period of what feels like considerable frustration. There is increased regulation, but still too much uncertainty. Market prices are weak, while confidence is low. All of this exists amid a potent background of climate change urgency, a cost-of-living crisis, geopolitical fragmentation, and extremely tight labour markets.

 

Beef: North Island bull price will track above the five-year average price range in 2023, supported by tight global beef supplies.

 

Sheepmeat: Lamb and mutton schedules face headwinds in all key markets. Import demand from China will likely improve from mid-2023, supporting farmgate returns in Spring and Summer.