Higher costs cut farm production value

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Higher costs including fuel prices will lower the value of Australia’s farm production in the coming year, according to a new forecast.

The chief commodities forecaster, the Australian Bureau of Agricultural and Resource Economics (ABARE), has tipped a six per cent fall in the net value of farm production to $6 billion in 2006/07.

The gross value of production is expected to be static at around $37 billion for the year.

ABARE said farm costs would rise about one per cent in 2006/07 to $31 billion.

“The higher cost of chemicals and fertiliser, marketing, labour and interest paid are major contributors to this forecast increase,” ABARE said in its first commodities report for the year.

The Age