Highlights

The NAB Rural Commodities Index continued to climb in June – up by 2.2% month-on-month in Australian dollar (AUD) terms. We have observed a clear upward trend since October 2024, which means that our index was 8.6% higher in June than a year ago.

There has been considerable volatility in the US dollar exchange rate over the past year – with the rate in June 2025 around 2.1% below that of June 2024. This means in US dollar (USD) terms, our index rose by 6.4% yoy. There has been a strengthening trend in the AUD since February this year.

The month-on-month increase in our AUD index in June was driven by vegetables (with poor rainfall earlier in the year driving broccoli prices higher), lamb (where the trade lamb price has risen to record highs) and beef. In contrast, dairy, wheat and sugar prices were weaker in June.

The BoM forecasts above average rainfall for the eastern two-thirds of Australia between August and October –with unusually high rainfall across northern parts of this region.

Climatic conditions, as measured by the El Nino-Southern Oscillation (ENSO) index have remained in neutral territory for an extended period. The BoM’s modelling suggests that this trend will continue until at least December.

Where US tariffs ultimately settle is still very unclear, meaning trade policy uncertainty remains elevated, weighing on business and consumer sentiment. Given this, we only see soft global growth by historical standards through to 2027.

Recent Australian activity data has been mixed, with household consumption seemingly remaining weak in Q2 (as households seek to restore their savings). This should result in another year of sub-trend growth in 2025 but move back to trend levels in 2026.

Read more here: Rural Commodities Wrap – July 2025