The dry winter across much of Western Australia has significantly affected the outlook for the state’s agricultural producers, particularly wheat and sheep farmers – prompting concern for a major downturn in the rural business sector.
While the ongoing lack of rain has led forecasters to downgrade the state’s expected wheat crop this year, sheep exporter WAMMCO International has also been forced to adjust its contract and export marketing processes.
The farmer-owned meat-processing cooperative has reduced the minimum weight from 22 kilograms plus to 20kg for its recently released 2006-07 forward contracts of heavy lamb.
WAMMCO chief executive Des Griffiths said overseas outlets were available for lighter lambs, but the company could not be expected to offer returns of heavier weight markets such as North America.
“Hopefully our overseas customers will understand the seasonal predicament faced by our lamb producers and agree to lower their weight limits,” Mr Griffiths told WA Business News.
“We will be making every effort to ensure that we do not lose valued markets that we have fought hard to develop.”
He said WAMMCO was concerned that if the dry conditions continued into the season the condition of lambs, as well as their weight, would pose problems.
Meanwhile, WA Farmers Federation president Trevor De Landgrafft told WA Business News industries including machinery dealers were feeling the pinch following the worst start to a season in the past 10 years.
“Farmers have stopped buying machinery very early this year [due to the dry conditions],” he said. “Local towns and their economies are being affected badly. Farmers are cutting their spending in the towns, [spending] that keeps small business trading on.”
Agricultural fertiliser company CSBP Ltd’s general manager, Darryl Dent, said the big issue for the company was the impact of this year’s drought on next year’s sales figures.
“What particularly happens in droughts is that farmers have sown their crops already,” he said.
“The nutrients are already in the ground and stock of fertiliser [for next year’s crop] is now in the shed. Assuming there’s little or no rain, the nutrients will remain in the soil, which will reduce the need to purchase fertiliser for next year’s crops.”
Dowerin GWN Machinery Field Days CEO Greg Ross said while not many big sales would be made this year overall, dealers were still keen to attend the field days.
