AgForce welcomes release of Queensland rural debt survey

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AgForce welcomes release of Queensland rural debt survey
Wednesday, 25 Jul 2018

Queensland farmers have worked hard to improve their financial resilience despite ongoing dry conditions with a new survey revealing rural debt levels are relatively stable and the quality of debt has improved.

Agriculture Minister Mark Furner released the 2017 Queensland Rural Debt Survey today, which noted that total rural debt was now $17.2 billion, up 1.6% since the last survey in 2011.

AgForce General Manager of Policy Dr Dale Miller welcomed the release of the survey and said while it was only a snapshot in time, it was important to have the information to inform policy responses and improve our understanding of the financial state of agriculture in Queensland.

“The survey highlighted there were a range of debt levels being experienced within the different broadacre industries and in different regions,” he said.

“With Queensland having almost half the nation’s cattle herd, the beef industry has the largest proportion of rural debt in Queensland at about $9.3 billion or 54 per cent of the total debt,” he said.

“Despite the drought over the past six years, beef industry borrowings have only risen by about two per cent overall with higher prices allowing some producers to pay down debt in recent years. The average debt per borrower in the beef industry is now $1.2 million, down from $1.4 million in 2011.

“It is heartening to see that risk ratings have improved too with about 95 per cent of the debt considered viable or potentially viable long term, however there has been an increase in the number of borrowers and continued support is needed for those experiencing debt difficulties.

“The survey reveals that grains industry debt has decreased by about 15 per cent on the back of strong winter crops in recent years and high chick pea prices in 2015 and 2016, although the current outlook for the state’s grain growers is challenging due to continuing dry conditions.

“The sheep industry’s debt levels have increased by 36 per cent, which is attributed to both the impact of drought and the significant investment being made in exclusion fencing to tackle wild dogs. This investment infrastructure is vital to help the sheep and wool industry rebuild.

“Overall, the survey highlights how important debt funding from banks is as source of capital for agricultural businesses in Queensland and underlines the ongoing challenges producers face under changing seasonal and economic circumstances.”

A copy of the 2017 Queensland Rural Debt Survey is available at http://www.qrida.qld.gov.au/news-and-events/rural-debt-survey

Media Contacts: Scott Whitby 0418 733 102, Sarah Henderson 0427 626 853

AgForce welcomes release of Queensland rural debt survey

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