Australia Agribusiness Outlook 2021
In a turbulent environment marked by the pandemic, La Niña affecting production, political tensions, and trade wars, demand for F&A products remains surprisingly firm. The weather is favouring Australian farmers, while being less benevolent with prospects of competitors offshore, helping to significantly tighten global markets and drive up global commodity prices.
Report summary
The political tensions between China and Australia show no sign of easing, with several products being blocked and shipments to China falling significantly. However, despite the punitive actions of the Chinese government, high prices, low interest rates, and favourable seasonal conditions are underpinning a profitable season for most farmers in 2020/21.
A generally profitable 2020/21 season for Australian agriculture will help start the recovery process from the recent east coast drought, but it will also put farmers in a stronger position as they navigate three major transitions: recovery from the pandemic, reducing reliance on China, and increasing sustainability.
Here are the main highlights for some of Australia’s key commodities. The full report provides an overview of the developments to watch.
• Strong global demand to keep wheat prices firm through 2021
• Profitable market settings for dairy expected to extend into the 2021/22 season
• 2021 to be a rebuild year for beef
• Lamb prices to remain strong but fall short of recent record levels, given weaker demand and increasing lamb numbers
• Cotton production set for a sharp recovery
• Covid-19 disruptions to foodservice to continue to underpin retail demand for wine
