Rabobank’s Australia Agribusiness Outlook 2025 provides valuable insights into the agricultural sector’s prospects for the year ahead. Despite anticipated challenges such as rising global geopolitical tensions, an underperforming Asian economy, and a volatile energy market, the report highlights that Australia’s agricultural sector is well positioned for the coming year.
The report predicts a rise in RaboResearch Australia Commodity Price Index for 2025, driven by strong livestock commodity prices and potential upside for grain prices. However, the optimism is tempered by concerns over below-average soil moisture levels in many regions, particularly in cropping and dairy areas along the south coast of Australia.
Lead author Stefan Vogel, RaboResearch general manager for Australia and New Zealand, emphasized the importance of monitoring soil moisture levels in key regions and highlighted the positive outlook for beef and sheep producers in terms of farm-grown feed availability. While limited price movements are expected for farm inputs like fertilizers and plant protection chemicals, there is a potential upside price risk, and crude oil prices are forecasted to decrease from recent highs.
The report also anticipates three 0.25 basis point reductions in the official cash rate by the Reserve Bank of Australia, providing relief for the agricultural sector. Despite a subdued global economic outlook, Australia’s GDP growth recovery to 2.3 percent in 2025 is seen as an exception compared to major economies like the US and China, which are expected to struggle.
In terms of commodity price outlook, RaboResearch expects its Rural Commodity Price Index to rise above the 10-year average in 2025, supported by positive price developments and solid production volumes. The report highlights sector-specific dynamics, with modest optimism for beef prices, potential support for wheat prices due to falling global stock levels, and upside in dairy commodity markets.
Geopolitical factors and shipping remain areas of concern, with potential volatility stemming from global tensions and trade disruptions. The report warns of the impact of geopolitical conflicts on energy prices and freight costs, which could affect farm input prices in Australia.
Biosecurity is also highlighted as a key concern, with the recent foot-and-mouth disease outbreak in Germany underscoring the importance of controlling incidents and maintaining trade confidence. The report emphasizes the need for vigilance in biosecurity measures to safeguard Australia’s agriculture industry.
Overall, Rabobank’s Australia Agribusiness Outlook 2025 provides a comprehensive analysis of the opportunities and challenges facing the agricultural sector in the year ahead, offering valuable insights for industry stakeholders and decision-makers.
