Australia’s future food and fibre production is being threatened by surging land prices, NSW Farmers says.
According to Rabobank’s Australian Agricultural Land Price Outlook, three seasons of good financial performance from the sector was driving a rise in agricultural land prices, with two-thirds of NSW jumping by 19 per cent in the past year.
NSW Farmers Young Farmers Council chair Martin Murray said the price rises meant young people looking to enter the industry will find it harder to get a start.
“Like we’re seeing in the housing market, the rising property prices are good for older people looking to sell but are really tough for the next generation,” Mr Murray said.
“Where we differ from housing though is that farms need to be able to turn a profit, and these price jumps are just outpacing our ability to earn more from the land.
“With rising interest rates and the cost of fuel, fertiliser and electricity going up, we’re going to need to see some serious investment in farm productivity to help farmers simply make ends meet in the future.”
While land values had risen, Mr Murray said, so too had input prices to produce food and fibre from that land, meaning high yields and commodity prices that had driving the price rises had been eaten up by inflation.
“The rise in agricultural land prices is a double-edged sword – good for those wanting to sell, tough for those wanting to buy,” Mr Murray said.
“The big problem for Australia and our future food supply is if we don’t get young farmers coming through, we won’t have anyone to grow our food in the future – it’s that simple.
“This is something NSW Farmers has been actively working on for a while now, and we’re going to need partnerships from industry and government to solve it.”
