Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) has officially released its definitive June 2026 quarter Agricultural Commodities and Australian Crop reports. The sweeping data marks the end of a highly lucrative phase, forecasting an immediate cooling period for the nation’s livestock and broadacre farming sectors after a record-breaking 2025–26 financial year.
A combination of less favorable, drier seasonal conditions and softening market prices is projected to push overall farm revenues and profits down sharply across the country.
Macro Economic Contraction: Value and Revenue Projections
Following peak commodity pricing that drove agricultural production value to historical highs last year, the entire sector is bracing for a systematic correction.
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Overall Production Value Decline: ABARES forecasts the gross value of total Australian agricultural production to contract by 5%, falling to $98.3 billion in the 2026–27 financial year ($104.5 billion when fisheries and forestry are included).
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Export Slump: Reflecting a tighter supply available for international trade lanes, agricultural export value is set to drop by $7 billion, bottoming out at $74.8 billion.
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Broadacre Farm Profit Collapse: In the most jarring statistic from the June release, average broadacre farm business profits are projected to plummet by 70% in 2026–27. This massive drop is driven by lower crop yields, lower livestock returns, and unyielding overhead expenses.
Livestock Sector Performance: Lower Prices Cool the Market
The livestock industry, which hit a staggering record value of around $23 billion for meat production alone in the 2025–26 cycle, is facing immediate downward pricing pressures.
The total combined value of livestock and livestock products is forecast to decline by $1.1 billion in 2026–27, settling at $47.4 billion. While domestic herd numbers remain relatively intact from previous rebuilding phases, the primary driver behind this multi-billion-dollar correction is lower farm-gate prices received for cattle and sheep. Drier pasture outlooks are forcing producers to stabilize or trim stock, altering the supply-demand equilibrium in local saleyards.
Feed and Crop Matrix: Shifting Agronomic Realities
The livestock market’s performance is deeply intertwined with a sharp reduction in Australia’s winter crop production, which limits local grazing capacity and increases feed-grain competition.
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Winter Crop Deficit: Total winter crop production is forecast to decline by 21% to 54.5 million tonnes. Erratic summer and autumn rainfall severely restricted early pasture growth and limited the total area planted by growers.
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Wheat Harvest Collapse: The national wheat harvest is set to experience a 26% year-on-year drop, down to 26.7 million tonnes, with total wheat acreage shrinking by 12% to the smallest footprint seen since 2019–20.
Geopolitical Headwinds: The Input Cost Squeeze
Compounding the dry weather, ongoing geopolitical conflicts in the Middle East continue to disrupt international agricultural supply chains. Because the Australian farming model is heavily export-oriented and relies on imported farm inputs, the macro-conflict is directly threatening farm-gate gross margins.
While global grain and oilseed export prices rose by roughly 20% due to trade route changes, the cost of imported inputs rose much faster. Domestic prices for urea (fertilizer) have surged by more than 80%, while fuel, packaging, and chemical protectant costs remain stubbornly elevated.
Facing an expensive combination of high fertilizer costs and a dry winter weather forecast, a growing number of broadacre farmers are choosing to leave plowed land completely unplanted. This protective, risk-averse strategy directly restricts the volumes of grain available to local livestock feedlot operations.
Executive Outlook
“Farmers’ decisions over the last few months have been shaped heavily by seasonal conditions and gross margins,” stated ABARES Acting Executive Director David Galeano. “We expect fertilizer and fuel input costs to remain elevated in 2026–27. Farm revenue is forecast to decline due to lower crop and livestock production volumes and lower prices received for livestock.”
