Rural commodity prices boosted by falling dollar
7 Jul 2004
The Westpac-NFF rural commodity index continued its rise, increasing by 1.0 per cent during June, supported by a 2 per cent fall in the Australian dollar during the month. Strengthening prices for canola, sugar, beef and wool were partly offset by weaknesses in wheat, barley and cotton prices.
“The continuing improvement in the rural commodity index is good news for farmers, who have been struggling with the effects of drought recovery combined with an uncompetitive dollar,” NFF Farm Business and Economics Committee Chair, Mr Charles Burke said. “Particularly welcome is the continuing rebound in sugar prices, which is returning prices to more sustainable levels.
“During June, many cropping areas of Australian received good rainfalls, which provided some welcome relief for farmers still recovering from the drought.
“However, many areas are not out of the woods yet. For example, more than 90 per cent of New South Wales remains drought declared and there were only minor rainfalls in many areas of Queensland during June.”
Westpac Senior Economist, Mr Justin Smirk said rainfall, or more precisely the lack of it, remained the key concern. “While the gathering global recovery and a weaker Australian dollar remain a mild positive for farm commodity prices, unless rain falls soon, many farmers will not be able to capture the full benefit of robust commodity prices,” Mr Smirk said.
The Westpac NFF Index is weighted according to the value of Australian agricultural exports and includes only rural commodities – unlike other price indices that are overshadowed by oil, mineral and energy prices. It provides daily movements based on prices of Australia’s seven key farm exports – wheat, barley, beef, wool, cotton, sugar and canola – in both $US and $A.
The latest Westpac NFF Rural Commodity Index is available at www.nff.org.au
NFF Press Release, 7th July, 2004
by Mairi Barton, General Manager Public Relations, NFF
|
