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Sheep, Wool & Goats

16 October, 2020

Aussie farmers poised to capitalise on improved conditions

PRODUCERS have flocked to new vehicles and equipment in what National Australia Bank analysts say is one of the leading trends of the Covid-19 recovery phase.

By Edwina Watson RURAL LEADER JOURNALIST

Barcaldine grazier, Scott Counsell, with NAB Longreach's Agribusiness Manager, Albert Capel

NAB Agribusiness Customer Executive, Julie Rynski, said the majority of growers and graziers had proven exceptionally resilient through two years of challenging circumstances, and were now poised to capitalise on improved conditions.

“Producers have responded uniquely to a plethora of market disruptions, from drought, to fire, to the Covid-19 pandemic,” Ms Rynski said.

“In horticulture, disruption to the retail channel has been challenging but many have found a way to reach markets.

“Some of our broadacre and extensive grazing businesses were able to capitalise on balance sheet strength and a long-term relationship with their bank,” Ms Rynski said.

“This allowed them to expand properties to access feed and so hold onto a breeding herd, or fund short-term enterprise switches.”

For Barcaldine grazier, Scott Counsell, short-term enterprise diversification assisted with cash flow and land management through ongoing drought.

Mr Counsell, in partnership with his wife Sharon and sister Frances, manages the 18,200-hectares of open downs, gidgee, Boree and sandalwood country at Lyndon.

The fourth-generation family farming operation also spans Patricia Downs, a 28,000-hectare property south-east of Ilfracombe.

Mr Counsell said in 2017 he was forced to completely destock 20,000 sheep and 400 head of Droughtmaster shorthorn cattle, with little ground cover left after four years of drought.

“Since 2014 we have experienced consistent below average rainfall, receiving around 150 to 200 millimetres of our 450-millimetre average,” Mr Counsell said.

“Switching from a self-replacing Merino flock to straight wethers run for wool and trade, as well as goats behind wire, was initially a short-term management strategy.

“We saw an opportunity to buy in wethers and make money in an accelerated shearing program,” Mr Counsell said.

Mr Counsell said running about 8000 wethers as part of an eight-monthly shearing program provided an additional wool cheque, while also assisting cash flow with improvements in condition, less chemical use and no crutching.

Mr Counsell continued to diversify and spread risk when, in 2017, he introduced goats to his property and erected cluster fencing.

“We initially introduced around 1000 goats and today we run 7000,” Mr Counsell said.

“They are resilient, easy to manage, and with recent record prices, returns have been excellent.

“Spreading goats out across the country provides the added bonus of timber control, with their alternative grazing techniques assisting with regrowth and land management.

“In the dry, it was important to invest in stock that were easy on the country.”

Mr Counsell said the 120km of exclusion fencing bordering the properties cost about $8000 per kilometre and was a worthwhile investment in preventing ongoing feral pest damage.

“Increasing numbers of wild dogs were making it unviable to run our sheep operation, and we were losing 50 per cent of lambs to dog attacks,” Mr Counsell said.

“We’ll keep on doing what we’re doing until we get consistency of seasons, and then we’ll look to shift back into breeding Merino ewes.”

Ms Rynski said despite serious headwinds, the NAB Rural Commodities Index was up 4.6 per cent in August 2020 on a year-on-year basis, reflective of the sector’s overall resilience. 

“We also saw livestock prices surge in early 2020 in response to average or above average rain in key production areas, with the Eastern Young Cattle Indicator reaching a record high of 772 cents/kg in mid-June,” Ms Rynski said. 

“While strong fundamentals have certainly supported the sector, it’s the long-term planning and strategic business management displayed by producers that has set them up to now capitalise on improved conditions.”


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