Farmer confidence in New South Wales (NSW) is on the mend, as noted in Rabobank’s latest Rural Confidence Survey, which indicates the state is experiencing a reversal from the downturn seen towards the end of 2024. The survey, released yesterday, captures the perspective of farmers as they embrace 2025 with cautious optimism, with the South Coast and Southern Highlands recording the highest confidence levels in the state.
PHOTO: Toby Mendl, Rabobank’s state manager for NSW.
Improved weather conditions have chiefly driven this positive shift, even as opinions remain nearly split on whether the agricultural economy will improve, worsen, or stay the same. Survey data reveal that 21 per cent of NSW farmers expect conditions to enhance over the next 12 months, marking an increase from 18 per cent in the previous quarter. Meanwhile, those with a pessimistic outlook have decreased to 22 per cent from 25 per cent previously. A significant 51 per cent foresee little change.
The state’s confidence index saw a modest climb, reaching -1 per cent from the previous -7 per cent. However, this uplift places NSW among the lower rungs in farmer confidence nationwide, only ahead of Western Australia. Nationally, about 24 per cent of farmers expect improved conditions, with South Australia and Tasmania witnessing the most notable increases in sentiment.
PHOTO: Much needed rains reached the Monaro and South Coast region in the first quarter of 2025 – taken near Dalgety, March 2025.
The South Coast and Southern Highlands region reported the most significant turnaround, emerging as the state’s confidence leader after languishing with low sentiment in the prior quarter. “We’ve observed a marked improvement in these areas,” noted Toby Mendl, Rabobank’s state manager for NSW. Mendl added, “Although it’s been a dry summer, it’s not unusual for farmers to be looking ahead to rain to set them up for the year.”
Indeed, 44 per cent of surveyed farmers express concern that continued dry conditions could adversely affect the agricultural economy. Nevertheless, 32 per cent remain optimistic about the seasonal outlook, buoyed by favourable overseas markets and rising commodity prices. Despite concerns about government policies and global markets — cited by 31 per cent and 30 per cent respectively — there is a notable feeling of resilience.
PHOTO: Optimism and confidence has returned among NSW sheep producers.
NSW’s sheep producers lead the charge in confidence revival, with sentiment turning from a gloomy -33 per cent to a positive four per cent. Dairy producers have also experienced a significant sentiment upswing. Mr Mendl points to robust consumer demand for red meat in the US as a key factor, noting, “Beef retail prices have reached unprecedented highs, influencing lamb prices.” However, he cautions that “US trade duties and geopolitical tensions remain areas of concern.”
Beef sector optimism persists, bolstered by consistent prices despite record production levels in 2024. In contrast, the grain sector experienced a decline to -35 per cent in net confidence, attributed to seasonal uncertainties. “NSW grain growers enjoyed a remarkable 2024 harvest but now await the autumn break before the next cropping season,” Mr Mendl explained.
PHOTO: The beef sector remains positive under consistent prices – taken in Jimenbuen, March 2025.
Investment intentions have shown robust strength in NSW, second only to Queensland and Tasmania. The survey finds 91 per cent of farmers plan to maintain or boost spending on-farm, with a special focus on infrastructure and new technology. Dairy and sheep producers, in particular, express high investment propensities. “Farmers are keen to invest in improving their operations, particularly in on-farm storage and new technologies,” Mr Mendl stated.
Economic optimism is reflected in income forecasts, with 29 per cent of respondents expecting income growth in the coming year. Dairy farmers remain the most upbeat, closely followed by sheep producers, while grain growers show more tempered expectations.