Confidence hinges on crop conditions

WA rural confidence has risen from the previous quarter's lows but the outlook among farmers across the State is divided according to the latest Rabobank Rural Confidence Survey.

The survey, released earlier this week, reported an overall improvement in WA farmer sentiment.

Confidence remained at a slightly negative level with a net reading of minus 9 per cent, up from minus 28 per cent last quarter.

Rabobank acting State manager Stephen Kelly said the results reflected the divided outlook among farmers, particularly grain growers, with crop conditions dictating sentiment.

"We have a situation where nearly half of the State's grain growers are anticipating an average harvest, while almost a quarter are experiencing one of their best years ever," he said.

"Some areas in the eastern and north-eastern Wheatbelt are doing it particularly tough, but we would estimate that nearly half of the State will get an average crop this year while those in the great southern region, around Esperance and parts of the Albany port zone are hopeful for a bumper harvest."

Mr Kelly said the next six weeks would decide if the potential for a good harvest would be realised.

"The crop is not in the bag yet, and while we are forecasting a bigger wheat crop than last year, of above seven million tonnes, it will all hang on rainfall and avoiding frost over the next few weeks," he said.

Sheep graziers were the most positive farming sector in WA this quarter, with their confidence rebounding significantly from low levels. Commodity prices were also a concern, raised by 30 per cent of respondents.

Input prices (25 per cent) and government intervention (18 per cent) were also raised as reasons conditions were expected to deteriorate.

While farmers were slightly negative in their outlook for the coming year, they remained positive about the future performance of their own farm business than of the wider agricultural economy.

About a third of farmers (32 per cent, up from 19 per cent) expected a stronger business performance, while 44 per cent expected their business to perform at a similar level to last year. Just 18 per cent expected their business performance to worsen, down from 26 per cent, in the previous survey.