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Farm financial performance – Western Australia

​​​​​​​Estimates of financial performance are available for all broadacre, dairy and vegetable farms in Western Australia.

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In 2016–17 farm cash income of Western Australia broad acre farms increased by 12 per cent to $387,400 per farm (Table 1) as a result of very high crop yields and increases in sheep, lamb and wool prices. In 2016–17 average total farm cash income increased in all regions of Western Australia (Table 2).

Overall, broadacre farm cash income in Western Australia is estimated to have decreased to average $358,000 per farm in 2017–18 ((Figure 1). This is still around 49 per cent above the 10-year average to 2016–17. Despite increases in grain prices, lower grain yields in 2017–18 compared to 2016–17, resulted in reduced crop receipts. Receipts from beef cattle declined as a result of lower beef cattle prices. Receipts from sheep, lambs and wool increased as a result of higher prices.

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 Western Australia 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, Western Australia, 2015–16 to 2017–18
average per farm
MeasureUnit2015–162016–17pRSE2017–18y
Total cash receipts$968,1901,112,800(5)1,063,000
Total cash costs$664,080725,400(5)705,000
Farm cash income$304,120387,400(6)358,000
Farms with negative farm cash income%  5  6(37)  11
Farm business profit $171,270234,800(10)229,000
Profit at full equity
    - excluding capital appreciation$244,520304,100(8)296,000
    - including capital appreciation$336,030351,900(12)na
Farm capital at 30 June a$5,973,2406,031,900(5)na
Net capital additions$70,020184,600(28)na
Farm debt at 30 June b$919,530992,100(11)973,000
Change in debt - 1 July to 30 June b%3–1(369)1
Equity at 30 June bc$4,673,3604,641,200(6)na
Equity ratio bd%  84  82(2)na
Farm liquid assets at 30 June b$206,700265,200(15)na
Farm management deposits (FMDs) at 30 June b$86,070105,400(17)na
Share of farms with FMDs at 30 June b%  28  32(15)na
Rate of return e
    - excluding capital appreciation %4.25.2(8)5.0
    - including capital appreciation %5.86.1(11)na
Off-farm income of owner manager and spouse b$28,27024,300(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 Western Australian broadacre farms, by region, 2016–17 to 2017–18
average per farm
ABARES regionUnitFive years ending 2015–162016–17pRSE2017–18y
511: WA Kimberley$863,6101,608,800(9)904,000
512: WA Pilbara and Southern Rangelands$329,940747,400(22)456,000
521: WA Central and South Wheat Belt$292,850427,900(9)449,000
522: WA North and East Wheat Belt$305,710451,400(11)300,000
531: WA South West$97,910155,300(20)192,000

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

Shows the ABARES high rainfall zone (eastern seaboard, Western 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 income of beef industry farms declined to $324,100 per farm in 2016–17 as a result of a reduction in the number of cattle sold and despite higher cattle prices. Average total cash costs also increased mainly as a result of increases in expenditure on livestock purchases, repairs and maintenance, and hired labour.

In 2017–18 farm cash income of beef industry farms is estimated to have decreased further to average $200,000 per farm (Figure 2) as a result of lower prices for beef cattle. Average farm cash income estimates for 2017–18 is still around 28 per cent above the 10–year average to 2016–17 of $155,100 per farm.

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 Western Australia 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 increased by 86 per cent to average $144,600 per farm as a result of higher sheep, lamb and wool prices.

In 2017–18 farm cash income for Western Australian sheep industry farms is estimated to have increased to average $181,000 per farm (Figure 3) as a result of further increases in wool, lamb and sheep prices combined with increased production. This is the highest average farm cash income for Western Australian sheep industry farms in 20-years, around 123 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 grains industry farms in Australia and Western Australia 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

Farm cash income for Western Australian grains farms increased in 2016–17 to an average of $552,500 per farm. This was mainly a result of very high crop yields and despite lower crop prices. Increased sheep and wool receipts as a result of higher sheep, lamb and wool prices also boosted receipts on mixed enterprise grains farms.

In 2017–18 average farm cash income for Western Australian grains industry farms is estimated to have declined to $504,000 per farm (Figure 4), around 50 per cent above the 10-year average to 2016–17. Despite increases in grain prices, lower crop yields compared to 2016–17 resulted in lower overall crop receipts. Lower crop receipts have been partly offset by reduced costs of handling and marketing the smaller crop and by increased sheep, lamb and wool prices as a result of higher sheep and wool prices.

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 Western Australia 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 Western Australia dairy farms increased by 12 per cent to $374,000 per farm in 2016–17 (Figure 5). This was a result of lower total costs due to reduced expenditure on fodder mainly as a result of lower feed grain prices. Milk receipts declined slightly because of lower milk prices and a small decline in average milk production per farm.

Average farm cash income is estimated to have declined to $312,000 per farm in 2017–18 (Table 3) mainly as a result of increased costs as drier seasonal conditions and higher feed grain prices resulted in increased fodder expenditure. Farm cash income in 2017–18 is estimated to be around 35 per cent above the 10-year average to 2016–17.

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 Western Australia 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, Western Australian dairy industry 2015–16 to 2017–18
average per farm
MeasureUnit2015–162016–17pRSE2017–18y
Total cash receipts$1,428,2101,424,300(7)1,409,000
Total cash costs$1,093,9501,050,300(7)1,096,000
Farm cash income$334,260374,000(11)312,000
Farms with negative farm cash income%  2  1(82)  5
Farm business profit$201,260262,700(21)202,000
Profit at full equity
    - excluding capital appreciation$316,980364,000(15)314,000
    - including capital appreciation$373,500399,500(13)na
Farm capital at 30 June a$9,449,9509,869,500(7)na
Net capital additions$86,280–159,400(90)na
Farm debt at 30 June b$1,365,9301,171,700(15)1,442,000
Change in debt - 1 July to 30 June b%8.0–4.0(30)4.0
Equity at 30 June bc$8,193,4708,308,600(6)na
Equity ratio bd%  86  88(2)na
Farm liquid assets at 30 June b$179,260192,700(34)na
Farm management deposits (FMDs) at 30 June b$54,38068,900(34)na
Share of farms with FMDs at 30 June b%  23  28(33)na
Rate of return e
    - excluding capital appreciation%3.43.7(14)3.2
    - including capital appreciation%4.04.0(13)na
Off-farm income of owner manager and partner b$13,05013,500(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 Western Australia had an estimated 280 vegetable-growing farms, accounting for around 12 per cent of Australian vegetable-growing farms. Most farms were located along the coast near Perth and around Carnarvon along the Gascoyne River. The average area of WA vegetable-growing farms was around 186 hectares, with 39 hectares planted to vegetables. Vegetable production accounted for 5 per cent of the gross value of agricultural production in Western Australia (ABS 2017b).

In 2015–16 average farm cash income for Western Australian vegetable-growing farms increased by 8 per cent to around $411,500. Total vegetable receipts increased by 21 per cent as a result of increased vegetable prices. Lower vegetable yields led to a slight decline in total vegetable production per farm despite an increase in the average area planted to vegetables. Declines in receipts for potatoes and carrots partially offset increases in other vegetable receipts. Total cash costs increased by 28 per cent, mainly driven by increases in contracts paid, hired labour, seed and fertiliser.

Average farm cash income is estimated to have increased in 2016–17 by 2 per cent to $418,000 per farm. Total vegetable receipts increased by around 7 per cent because of the increase in total vegetable production. Higher receipts from potatoes, carrots, tomatoes and onions contributed to the increase in vegetable receipts. Total cash costs are projected to increase by around 9 per cent.

Table 4 Selected physical and financial results, vegetable-growing farms, Western Australia, 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 ($)

1,590,400

(20)

21

1,710,000

7

Area planted to vegetables (hectares)

39

(16)

18

40

3

Quantity of vegetables produced (tonnes)

1,135

(22)

–13

1,266

12

Farm cash income ($)

411,500

(25)

8

418,000

2

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:
15 Aug 2018