NAB senior leaders take a closer look at Australia’s trade and export sector – providing all-important insights into how regional and agribusinesses can best respond to today’s challenges and opportunities.
The NAB Rural Commodities Index eased further in October, having now declined for each of the past twelve months. Our index fell by 1.8% mom, leaving it 35.0% below the peak for rural prices in June 2022.
Cattle prices have been the main driver of the decline from the mid-2022 peak and they fell on average by 15.2% mom in October, although daily prices show a broadly sideways track across the month, following steep declines in September.
In contrast, there were notable price increases for chickpeas, lamb, dairy and vegetables – partially offsetting the downward pressure on our index.
Seasonal conditions remain challenging – rainfall in October was around 65% below the long term average. Persistently dry weather has led to low soil moisture, which will negatively impact crop growth in coming months.
Dry conditions are expected to continue – the BoM’s latest outlook for November through January sees a 60-80% chance of below median rainfall across northern, western and southern Australia – but with a chance of higher rainfall in northern NSW and southern QLD.
BoM models indicate that Pacific sea temperatures will remain above El Nino thresholds until at least early autumn. This has been combined with a positive Indian Ocean Dipole which can increase the drying effects of El Nino – which reduces spring and summer rainfall.
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