World finance makets are in melt down today. But here are some great numbers for Australias farmers, as at lunch time today:
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- The Aussie dollar was trading around 72 US cents, just 9 weeks ago it was 98cents. This will represent a massive boost for farm incomes.
- Oil was under $US89 a barrel, just 10 weeks ago it was $147 a barrel. Thats a 40% drop with no high dollar to distort the price. This should mean we will see fuel that was $1.70 a litre 10 weeks ago now back under a dollar a litre.
- The Reserve bank is expected to cut interest rates by half a percent today with more cuts expected to follow. It was just 12 weeks ago as variable rates edged up toward 10% that the Reserve was talking up more rate rises.
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The four major farm inputs are interest on debt, fuel, fertilizer & chemical (chemical & fertilizer prices are driven by oil prices). The cost all four major inputs has fallen dramatically. The dramatic fall in the dollar will drive export commodity prices up.
The Emissions Trading Scheme is dead and buried, or at least delayed indefinitely. Imposing an ETS on an economy is the perogative of only wealthy Western Countries.
The Government will have its hands full securing our economy in the face of a resources slow down that will follow a Western World recession, as surely as night follows day. It can ill afford to saddle the ecomony with the fiscal pressure of a go-it-alone carbon tax in industry and jobs.
The chances of the major emitting nations of the USA, China, Russia and India agreeing to restrict their economies will now be Slim to none, and Slim just let the building.
At last farmers had something to smile about. Its not all bad news. Unless of course farmers had borrowed up big to buy Shares or Urban Real Estate. Thats not likely.
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Surely you are overly optimistic about the fuel costs? For sure Oil has plunged, but so has the Aussie Dollar…
a 40% drop in the USD oil price is not going to translate to a 40% drop at the pump when the currency is down about 30%…
The silver lining for farmers is that they have guns…
G’day MattB,
Yes maybe a little on the fuel at the minute, but one thing I am fairly certain of is that it will get cheaper than $84. As world wide recession sets in demand will drop right off and then oversupply will kick in. Remember it was less that a decade ago oil was $40 a barrel.
“Over my cold dead body” - Yes Charlton LOL
There is a little Vin in all of us Steve
I mean Von not Vin
Hey mate,
pleased you clarified that. Thought it must have been a Sand Gropper thing.
Yeah sometimes I need the edit option - anyway more power to you Steve for letting us have a say.
Thank you Von,
Thats what its all about - a forum where Rural People and those interested in Rural Australia can have their say on the issues of the day.
Until now Australia has been almost completely devoid of Robust public debate about the issues that impact on rural Rural & Regional issues.
You know I have a theory that Guys like MattB, Matt, Tim, James etc - would really love own their own farms (although I think a couple of them might?)
We value everybody’s right to have their say, and everybody can make up their own minds from the points made in the ongoing debates. I know I’ve learnt a hell of a lot , a bit from everybody.
And rest assured that for each person participating on these forums there are 30-50 others reading and watching. Research has show that of the people that read blogs there is only 1-3% who actually comment.
Cheers
I think I’ve mentioned before but I come from primary producing stock, have a beef farming aunt/uncle, and married a country-ish gal - but if I went to a farm I’d let her do all the work while I pen my memoirs or something
G’day Matt,
If your good wife knows that, it might explain why you live in suburbia instead of on a farm where you belong - You know “you can take the boy out of the farm, but you can never take the farm out of the boy” and all that.
Its in your genes.
well we were more nurserymen… but the place was food food food in the wars… but then suburban liverpool caught up.
and… ahem… in Perth my kind of suburbia is called “inner city”… but many cities would be surprised and just how suburban perth’s “inner city” is
MANY HAVE TO BE HIT HARD TO MAKE THEM STOP
I know city people and farming people who have been living ‘ way over the top’ with their ‘life styles’.
The merry go round was going to stop one day and it just has.
The cycle has turned and farmers if they can manage to hold on will be on the up cycle to better times. Local food and fibre will be important again.
A WHOLE LOT RICHER IN THE THINGS THAT REALLY MATTER