Antony Glynn - Glynn Agriculture
With the calendar year drawing to a close its time to reflect on the year that was, or wasn’t, some might say! Most agribusinesses I’m involved with would say this year has been very tough, and the only reason is lack of rain.
Parts of Central Australia having only received two of the annual 12 inch rainfall, and vast areas of the Eastern states reporting the same shortfalls. Without rain primary production is very hard, but it does teach us to tighten the budget, innovate and be resourceful.
Whilst we could do without having to hone these skills, it has happened and when the season turns, I know I for one, will be better for it. That said the benefits are still out weighing the negatives. The cattle market is not far from record price levels on finished cattle and feeders are 10% shy of the best we have ever seen. This is on the back of $400-$500 tonne grain prices and the roughage component $300-$400 tonne.
With no significant grass across the country the store market is understandably not reflecting the same highs but in the context of the season you could argue that the re-stocker market has held on very well. This strong cattle market and perhaps a feeling that we may be due to return to some form of seasonal normality has caused a recent spike in enquiry for rural property.
Certainly, good cattle prices help sell good cattle properties, however there is more to it than just this short-term positivity, in my opinion, much more. Currently the U.S stock market is crashing on the back of the U.S./ China trade negotiation and the price of gold, as is to be expected, has strengthened as a result of this. And just like the precious metal the world has turned to as a safe place to park funds since day dot, Australian agricultural land has not crashed, in fact far from it.
In my opinion our rural land is being viewed Internationally as that safe investment. So, I believe the future is brighter than ever. Australian agricultural land values still have a lot of growing to do to catch Europe and North America and the investment market knows this. So while the daily grind during these dry times is tough, the future looks good.