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Farm financial performance - Victoria

​​​​​​​​​​​​​​​​​Estimates of financial performance are available for all broadacre, beef, sheep, grains, dairy and vegetable farms in Victoria.

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In 2016–17 farm cash income for broadacre farms of Victoria increased to $124,600 per farm (Table 1) as a result of increased receipts from wheat, barley, oilseeds, pulses and beef cattle. Reduced turn-off of sheep in 2016–17 resulted in a small reduction in receipts from sheep, despite an increase in sheep prices. In 2016–17 farm cash income for all regions of Victoria except the Central North region increased.

Overall average farm cash income for broadacre farms in Victoria is estimated to have increased further to $131,000 per farm in 2017–18 (Figure 1). This would be around 37 per cent above the 10-year average to 2016–17. This increase is mainly a result of higher livestock receipts due to expected increases in sheep, lamb and wool prices. Decline in wheat and barley receipts due to lower production is projected to have offset the increases in livestock receipts.
In 2017–18 farm cash income is estimated to have increased in all Victorian regions, particularly the Wimmera (Table 2).

Figure 1 Real farm cash income, broadacre industries, 1997–98 to 2017–18
average per farm

Shows farm cash income for broadacre industry farms in Australia and Victoria from 2001–02 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs. 

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Table 1 Financial performance, all broadacre industries, Victoria, 2015–16 to 2017–18
average per farm
MeasureUnit2015–162016–17pRSE2017–18y
Total cash receipts$338,390385,400(5)398,000
Total cash costs$242,330260,800(5)268,000
Farm cash income$96,060124,600(7)131,000
Farms with negative farm cash income%  20  16(27)  15
Farm business profit $–19,96079,400(12)53,000
Profit at full equity
    - excluding capital appreciation$9,040109,900(10)83,000
    - including capital appreciation$181,540302,000(11)na
Farm capital at 30 June a$3,897,8504,291,200(4)na
Net capital additions$4,73085,900(30)na
Farm debt at 30 June b$349,160398,100(8)397,000
Change in debt - 1 July to 30 June b%76(50)0
Equity at 30 June bc$3,263,8403,737,300(5)na
Equity ratio bd%  90  90(1)na
Farm liquid assets at 30 June b$156,910167,700(12)na
Farm management deposits (FMDs) at 30 June b$42,25045,900(17)na
Share of farms with FMDs at 30 June b%  21  26(13)na
Rate of return e
    - excluding capital appreciation%0.22.8(10)2.0
    - including capital appreciation%4.97.6(11)na
Off-farm income of owner manager and spouse b$ 34 000 92 400(62)na

a Excludes leased plant and equipment. b Excludes capital appreciation. c Farm capital minus farm debt. d Equity expressed as a percentage of farm capital. e Rate of return to farm capital at 1 July. p Preliminary estimate. y Provisional estimate. RSE Figures in parentheses are standard error expressed as a percentage of the estimate provided. na Not available.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Table 2 Farm cash income of Victorian broadacre farms, by region, 2016–17 to 2017–18
average per farm
RegionUnitFive years ending 2015–162016–17pRSE2017–18y
221: VIC Mallee$159,230178,900(30)182,000
222: VIC Wimmera$142,790179,300(17)225,000
223: VIC Central North$99,19069,700(22)75,000
231: VIC Southern and Eastern Victoria$80,550127,200(8)132,000

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Shows the ABARES high rainfall zone (eastern seaboard, South Australian south-east coast and south-west coast of Western Australia); wheat–sheep zone (south-east Queensland excluding the coast; central New South Wales, including the North West Slopes and Plains, Central West and Riverina, northern Victoria, South Australian Eyre Peninsula, Murraylands and Yorke Peninsula and Western Australian wheat belt ); and pastoral zone (Northern Territory, northern and central Western Australia, northern and central South Australia, western New South Wales, and northern and western Queensland). The map also shows the ABARES regions within these zones.

Note: Each region is identified by a unique code of three digits. The first digit identifies the state or territory, the second digit identifies the zone and the third digit identifies the region. Source: ABARES

Average farm cash incomes of Victorian beef industry farms decreased to $73,200 per farm in 2016–17 despite higher average prices received for beef cattle as herd rebuilding reduced beef cattle turn-off.

In 2017–18 farm cash income is estimated to have declined further to average $50,000 per farm (Figure 2), as receipts from the sale of cattle are reduced as a result of lower saleyard prices for beef cattle. Despite the reduction, average farm cash income is estimated to have been around 19 per cent above the 10–year average to 2016–17.

Figure 2 Real farm cash income, beef industry, 1997–98 to 2017–18
average per farm
Shows farm cash income for beef industry farms in Australia and Victoria from 2001–02 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs.

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

In 2016–17 farm cash income for sheep industry farms decreased slightly to average $110,300 per farm as a result of reduced sales of sheep and lambs. Increased wool receipts due to higher wool production and higher wool prices partly offset the impact of reduced sheep receipts.

In 2017–18 farm cash income for Victorian sheep industry farms is estimated to have increased to average $167,000 per farm (Figure 3) as a result of higher wool, lamb and sheep prices combined with an increase in the number of sheep and lambs sold. Farm cash income is projected to have been around 94 per cent higher than the 10-year average to 2016–17.

Figure 3 Real farm cash income, sheep industry, 1997–98 to 2017–18
average per farm
Shows farm cash income for sheep industry farms in Australia and Victoria from   2001–02 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs.

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

After a dry season in 2015–16, farm cash income for Victorian grains farms doubled in 2016–17 to average $195,200 per farm mainly as a result of record winter crop production and despite reductions in wheat and barley prices. Increases receipts for sheep and wool on mixed enterprise farms also contributed to increase in total cash receipts.

In 2017–18 average farm cash income for Victorian grain farms is estimated to have declined slightly to $195,000 per farm (Figure 4), around 32 per cent above the 10-year average to 2016–17. Reduced winter crop production, compared to the record 2016–17 crop, resulted in lower crop receipts despite increases in grain prices. Increases in receipts for sheep and wool are not projected be sufficient to offset lower crop receipts.

Figure 4 Real farm cash income, grains industry, 1997–98 to 2017–18
average per farm
Shows farm cash income for grains industry farms in Australia and Victoria from   2001–02 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs.

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Average farm cash income of Victorian dairy farms decreased by 49 per cent to an average of $53,700 per farm (Table 3) in 2016–17. This decline was driven by lower farmgate milk prices and reduced milk production.

In 2017–18 farm cash income is estimated to have increased to average $117,000 per farm (Figure 5), around 2 per cent above the 10-year average to 2015–16. This reflects both higher milk prices and increased milk production.

Figure 5 Real farm cash income, dairy industry, 1997–98 to 2017–18
average per farm
Shows farm cash income for dairy industry farms in Australia and Victoria from   2001–02 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs.

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Table 3 Financial performance, Victorian dairy industry 2015–16 to 2017–18
average per farm
MeasureUnit2015–162016–17pRSE 2017–18y
Total cash receipts$692,350626,100(4)708,000
Total cash costs$587,000572,400(5)590,000
Farm cash income$105,35053,700(54)118,000
Farms with negative farm cash income%  18  39(23)  30
Farm business profit $–39120–43700(83)31,000
Profit at full equity
    - excluding capital appreciation$22,67027,500(135)101,000
    - including capital appreciation$260,29099,800(44)na
Farm capital at 30 June a$4,159,9104,478,000(5)na
Net capital additions$105,530–32,500(237)na
Farm debt at 30 June b$880,010893,300(9)882,000
Change in debt - 1 July to 30 June b%8.0–4(153)–4
Equity at 30 June bc$3,340,9303,454,600(6)na
Equity ratio bd%  79  80(3)na
Farm liquid assets at 30 June b$181,110125,100(22)na
Farm management deposits (FMDs) at 30 June b$29,87029,200(44)na
Share of farms with FMDs at 30 June b%  23  18(39)na
Rate of return e
    - excluding capital appreciation%0.60.6(137)2.2
    - including capital appreciation%6.82.3(45)na
Off-farm income of owner manager and partner b$16,68015,500(22)na

a Excludes leased plant and equipment. b Excludes capital appreciation. c Farm capital minus farm debt. d Equity expressed as a percentage of farm capital. e Rate of return to farm capital at 1 July. p Preliminary estimate. y Provisional estimate. RSE Figures in parentheses are standard error expressed as a percentage of the estimate provided. na Not available.
Source: ABARES Australian Dairy Industry Survey

In 2015–16 Victoria had an estimated 490 vegetable-growing farms, accounting for around 21 per cent of Australian vegetable-growing farms. Most farms were located around Melbourne, the Gippsland region and the irrigated regions along the Murray River. The average area of Victorian vegetable-growing farms was around 227 hectares, with 65 hectares planted to vegetables. Vegetable production accounted for 7 per cent of the gross value of agricultural production in Victoria (ABS 2017b).

In 2015–16 average farm cash income for Victorian vegetable-growing farms fell by an estimated 7 per cent to average $374,100 per farm. Total vegetable production per farm increased as a result of an increase in the average area planted to vegetables. Increased vegetable production and higher vegetable prices led to an increase in average total vegetable receipts. Higher receipts from lettuce, carrots, Asian vegetables, broccoli and green beans mainly contributed to an increase in total vegetable receipts. Average total cash costs increased by 39 per cent to $1,779,800 per farm. In 2015–16 the cost of contracts paid and packing materials and charges largely contributed to increased cash costs.

Average farm cash income is projected to increase in 2016–17 by around 24 per cent to $463,000 per farm. Vegetable receipts are projected to increase as a result of higher expected prices despite a slight decline in projected vegetable production due to lower yields. Average total cash costs are also projected to increase by around 8 per cent.

Table 4 Selected physical and financial results, vegetable-growing farms, Victoria, 2015–16 and 2016–17, average per farm
Indicator

2015–16p

RSE

% change from 2014–15

2016–17y

% change from 2015–16

Vegetable cash receipts ($)1,946,300(13)362,182,00012
Area planted to vegetables (hectares)65(11)25650
Quantity of vegetables produced (tonnes)2,017(20)51,991–1
Farm cash income ($)374,100(25)–7463,00024

p Preliminary estimate. y Provisional estimate.
Note: Figures in parentheses are standard errors expressed as a percentage of the estimate.
Source: ABARES Australian vegetable-growing farms survey

Figure 6 Farm cash income, vegetable-growing farms, 2006–07 to 2016–17, average per farm

p Preliminary estimate. y Provisional estimate.
Source: ABARES Australian Vegetable Growing Farms Survey

Major financial performance indicators

  • Total cash receipts: total revenues received by the business during the financial year.
  • Total cash costs: payments made by the business for materials and services and for permanent and casual hired labour (excluding owner manager, partner and family labour).
  • Farm cash income: total cash receipts - total cash costs
  • Farm business profit: farm cash income + changes in trading stocks - depreciation - imputed labour costs
  • Profit at full equity: return produced by all the resources used in the business, farm business profit + rent + interest + finance lease payments - depreciation on leased items
  • Rate of return: return to all capital used, profit at full equity * 100 / total opening capital
  • Equity ratio: Farm capital minus farm debt expressed as a percentage of farm capital

Industry types

  • Grains: farms mainly engaged in producing broadacre crops such as wheat, coarse grains, oilseeds and pulses, and including farms running sheep and/or beef cattle in conjunction with substantial broadacre crop activity.
  • Sheep: farms mainly engaged in running sheep.
  • Beef: farms mainly engaged in running beef cattle.
  • Dairy: farms mainly engaged in milk production.
  • Vegetable: farms mainly engaged in growing vegetables.

Farm surveys definitions and methods
Further information about our survey definitions and methods.

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Last reviewed:
25 Jun 2018