This article is from the Australian Property Journal archive
THE Australian farmland total annualised return is at 11.29%, with this quarter seeing a return to positive performance after two consecutive periods of negative results.
According to ANREV’s latest quarterly Australian Farmland Index Q4 2023, from 31 March 2015 to 31 December 2023 Australian farmland total annualised return was at 11.29% with contributions from income return of 5.15% and capital growth of 5.93%.
On a quarterly basis, income returns of 0.89% and capital growth of -0.48% in Q4 led to a total return of 0.41%.
Over the last five years there was a total annualised return of 9.04% comprising income return of 4.27% and capital growth of 4.62%.
“Pleasingly the December quarter saw a return to positive performance following two quarters of negative performance experienced during 2023,” read participant commentary from Rural Funds Management.
“Annual farmland, which is mainly comprised of beef, sheep and cropping, produced a 2.0% income return with flat capital growth. A change in sentiment has been widely reported following better than expected rainfall and increasing commodity prices, particularly for beef cattle and sheep.”
ABARES’ Agricultural Commodities Report forecasts the value of Australian agricultural production to grow to AUD$85 billion in 2024-25, compared to AUD$80 billion in 2023-24.
Permanent producing a total return of -1.6% including comprised of -0.49% income return and -1.07% capital growth in Q4.
With ABARES forecasting horticultural production values to increasing by 3% in 2023–24 and 3% in 2024–25 to AUD $7.8 billion.
“However, 2024 has been reported for better growing conditions as well as an increase in the almond price. It is also reported the Californian crop may not meet production expectations,” read the report.
