AUSVEG’S latest survey has shown a 3.5 per cent dip in confidence among growers, during the July to September quarter.
The Grower Confidence Survey involves a selection of ten questions relating to how confident growers feel about key economic indicators, including macroeconomic confidence, investment confidence, market confidence and confidence in government policy.
The confidence index has been constructed on the basis of these survey results, based on an initial survey conducted for the March quarter.
“Australian vegetable growers are becoming more uncertain about the sustainability of their future within the industry,” AUSVEG chief executive Richard Mulcahy said.
“Producer confidence levels are found to be strongly correlated with, and a leading indicator of, turning points in economic activity. If growers lack confidence in the industry they are less likely to invest and expand their operations, in some cases resolving to leave the industry all together.
“These results are concerning for all stakeholders in the industry, as the most recent data on the gross value of the vegetable industry shows that it has declined by over 6.88 per cent.”
Mr Mulcahy said a reduction in investment could have detrimental effects on industry jobs growth and production.
The results show that confidence levels in government and investment have both declined over the survey period, supporting the overall decline in grower confidence. The government confidence index has declined by 28.4 per cent over the quarter and the investment confidence index has declined by 6.3 per cent.
“Investment confidence is measured through survey questions designed to understand grower sentiment towards future input costs such as labour, fuel or freight costs,” said Mr Mulcahy.
“The most recent report conducted by the Australian Bureau of Agricultural and Resource Economics and Sciences shows that production costs have increased by an average of 4 per cent since 2012-13. These latest survey results prove that production costs may now be having an impact on grower confidence and therefore continued investment and growth within the industry.”