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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Average farm cash income of Victorian broadacre farms increased in 2014–15 by 6 per cent to $96,600. Increased cash receipts from the sale of beef cattle, sheep and wool, mainly as a result of higher prices, offset reductions in crop receipts. Total crop receipts declined by around 20 per cent, driven by dry seasonal conditions compared with 2013–14.

Farm cash income of broadacre farms in Victoria is projected to have declined by 7 per cent in 2015–16 to average $91,000 a farm. This is around 14 per cent above the 10–year industry average to 2014–15. The reduction in average farm cash income is a result of reduced winter grain, oilseed and pulse yields because of extended dry seasonal conditions in some parts of Victoria. The reduction in crop receipts in 2015–16 is projected to have been the largest in the Wimmera region, resulting in average broadacre cash income in this region declining to just $20,000 a farm in 2015–16. Receipts from the sale of beef cattle and wool are projected to have increased in 2015–16 as a result of higher beef cattle and wool prices and receipts from sheep and lambs are projected to have declined slightly as a result of lower turn-off. Total cash costs are expected to have remained largely unchanged in 2015–16 compared with 2014–15 despite a decline in expenditure on livestock purchases and fuel.

Average farm cash incomes are projected to have declined in the Central North but to increase in Southern and Eastern Victoria, mainly driven by increased receipts from beef cattle resulting from higher beef prices, high beef cattle turn-off and higher wool prices.

Real farm cash income, broadacre industries, 2001–02 to 2015–16, 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.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Financial performance, Victoria broadacre industries 2013–14 to 2015–16 average per farm
Performance indicator2013–142014–15pRSE2015–16y
Total cash receipts ($)289,990303,000(4)298,000
Total cash costs ($)198,730206,400(4)207,000
Farm cash income ($)91,27096,600(7)91,000
Farms with negative farm cash income (%)2017(21)19
Farm business profit ($)4,990-12,900(50)-13,000
Profit at full equity a ($)28,60010,300(63)10,000
Farm capital at 30 June b ($)2,763,2403,153,100(4)na
Farm debt at 30 June c ($)239,460267,600(9)281,000
Equity ratio c d (%)9191(1)na
Rate of return a e (%)1.00.3(63)0.3
Off-farm income c f ($)33,50035,000(14)na

Source: ABARES Australian Agricultural and Grazing Industries Survey
RSE Standard error expressed as a percentage of the estimate provided
p Preliminary estimate
y Provisional estimate
a Excludes capital appreciation
b Excludes leased plant and equipment
c Average per responding farm
d Equity expressed as a percentage of farm capital
e Rate of return to farm capital at 1 July
f Off-farm income of owner manager and spouse
na Not available

Farm cash income of Victoria broadacre farms, by region, 2014–15 to 2015–16 average per farm
Region2014–15pRSE2015–16y
$$
221: VIC Mallee138,000(21)155,000
222: VIC Wimmera63,000(24)20,000
223: VIC Central North105,000(16)86,000
231: VIC Southern and Eastern Victoria96,000(9)100,000

Source: ABARES Australian Agricultural and Grazing Industries Survey
RSE Standard error expressed as a percentage of the estimate provided
p Preliminary estimate
y Provisional estimate

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

In 2014–15 average farm cash incomes of Victorian beef industry farms more than doubled, increasing from $27,000 in 2013–14 to $59 000 a farm. This was mainly driven by increased receipts resulting from higher average prices received for beef cattle and increased turn-off. Total cash costs increased as a result of higher expenditure on beef cattle purchases, fodder and repairs and maintenance.

Victorian beef industry farm cash income is expected to have increased marginally in 2015–16 to average $69,000 a farm. This is around 84 per cent above the 10–year average to 2014–15 and the highest average farm cash income of beef industry farms in Victoria since 2004–05. Further increases in prices for beef cattle are expected to have resulted in an increase in beef cattle receipts despite lower cattle turn-off. Greater expenditure on beef cattle purchases, repairs and maintenance and fertiliser is expected to have resulted in average total cash costs increasing.

Real farm cash income, beef industry, 2001–02 to 2015–16, 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.
Note: y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

In 2014–15, farm cash income of Victorian sheep industry farms more than doubled to an average of $103,000 a farm. Higher prices for adult sheep and wool, together with increased sales of sheep and wool, led to the increase in average farm cash income. This was despite an increase in farm cash costs mainly as a result of increased expenditure on sheep purchases, fodder, fertiliser and repairs and maintenance.

In 2015–16, farm cash income of sheep industry farms in Victoria is expected to have increased to an average of $121,000 a farm, around 80 per cent above the 10–year average to 2014–15. Despite a decline in sales of sheep, total cash receipts are estimated to have increased as a result of higher prices for sheep and wool together with an expected increase in the quantity of wool sold. Total cash costs are expected to have declined by around 5 per cent mainly as a result of reduced expenditure on sheep purchases and fodder.

Real farm cash income, sheep industry, 2001–02 to 2015–16, 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.
Note: y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Average farm cash income of Victorian grains industry farms decreased by around 30 per cent to $130,000 a farm in 2014–15. Crop receipts were reduced as dry seasonal conditions resulted in lower production of winter grains, oilseeds and pulse crops. For mixed crop–livestock farms, these lower crop receipts were partly offset by increased receipts from the sale of sheep, lambs and beef cattle. Total cash costs decreased slightly reflecting decreased expenditure on fertiliser and fuel.

In 2015–16, farm cash income is projected to have declined further for Victorian grains industry farms to an average of $90,000 a farm. This is around 30 per cent below the 10–year average to 2014–15. Crop receipts are projected to decrease as a result of reduced winter crop production.

Real farm cash income, grains industry, 2001–02 to 2015–16, 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.
Note: y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Average farm cash incomes of Victorian dairy farms decreased from $175,000 to $152,000 in 2014–15. Decline in total farm cash income in 2014–15 was driven mainly by reduced farmgate milk prices and increased cash costs offsetting an increase in total milk production. Total cash receipts increased around 4 per cent to an average of around $730,000 a farm as a result of increased milk production.

In 2015–16, farm cash income of Victorian dairy industry farms is projected to have declined to an average of $87,000 a farm. This is around 20 per cent below the 10–year average to 2014–15. The expected decline in farm cash income is mainly as a result of lower farmgate milk prices and lower milk production. Total farm cash costs are also expected to increase as a result of increased expenditure on fodder as a result of dry seasonal conditions.

Real farm cash income, dairy industry, 2001–02 to 2015–16, 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.
Note: y Provisional estimate.
Source: ABARES Australian Agricultural and Grazing Industries Survey

Financial performance, Victoria dairy industry 2013–14 to 2015–16 average per farm
Performance indicator2013–142014–15pRSE2015–16y
Total cash receipts ($)703,720730,000(6)670,000
Total cash costs ($)528,720577,800(6)582,000
Farm cash income ($)174,990152,100(15)87,000
Farms with negative farm cash income (%)1724(42)19
Farm business profit ($)79,03066,800(29)-21,000
Profit at full equity a ($)146,090128,700(18)37,000
Farm capital at 30 June b ($)3,452,1003,979,400(6)na
Farm debt at 30 June c ($)750,860806,400(12)830,000
Equity ratio c d (%)7880(3)na
Rate of return a e (%)4.33.4(16)0.9
Off-farm income c f ($)24,88016,800(35)na

Source: ABARES Australian Agricultural and Grazing Industries Survey
RSE Standard error expressed as a percentage of the estimate provided
p Preliminary estimate
y Provisional estimate
a Excludes capital appreciation
b Excludes leased plant and equipment
c Average per responding farm
d Equity expressed as a percentage of farm capital
e Rate of return to farm capital at 1 July
f Off-farm income of owner manager and spouse
na Not available

In 2014–15 an estimated 500 vegetable-growing farms were operating in Victoria, accounting for around 20 per cent of Australian vegetable-growing farms. Most farms were located around Melbourne, extending east through the Gippsland region and into the irrigated regions along the Murray River. The average area of vegetable-growing farms in Victoria in 2014–15 was around 213 hectares, of which 52 hectares was planted to vegetables. Vegetable production accounted for 6 per cent of the gross value of agricultural production in Victoria.

Estimated farm cash income was around $473,000 in 2015–16, 18 per cent higher than in 2014–15. This estimate was 118 per cent higher than the nine-year average farm cash income (in real terms) for Victoria to 2014–15. Total vegetable receipts increased by 7 per cent in 2015–16. Higher crop yields contributed to increased receipts for potatoes, tomatoes and broccoli.

Selected physical and financial results, Australian vegetable-growing farms, by state, 2014–15 and 2015–16, average per farm
Indicator2014–15pRSE% change from 2013–142015–16y% change from 2014–15
Vegetable cash receipts ($)1,432,800(31)211,539,0007
Area planted to vegetables (hectares)52(16)–951–1
Quantity of vegetables produced (tonnes)1,919(17)261,900–1
Farm cash income ($)400,600(36)58473,00018

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

Real farm cash income, vegetable industry, 2005–06 to 2015–16, average per farm
Shows farm cash income for vegetable industry farms in Australia and Victoria from   2005–06 to 2015–16 in 2015–16 dollars. Farm cash income has been consistently positive. The figure is discussed in the previous paragraphs.
Note: 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.

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Last reviewed:
06 Mar 2017