An improved outlook for regional Australia is forecast in the latest ANZ Regional and Rural Quarterly report released today.
The report says there is cause for optimism this year due to bumper crops fed by widespread rain in north-eastern Australia. There is also greater global demand for commodities and rising house prices in country areas.
But pressing challenges include continued drought in southern Australia, flooding in central Queensland and along the NSW north coast, higher interest rates, soaring dollar and tight labor markets.
Key findings include:
- Total summer core production to rise by almost 40% following rain across key agricultural regions.
- Sorghum crop expected to lift by 80% to a record 2.5 million tonnes.
- Wheat, coal and iron ore producers to benefit from higher global commodity prices.
The demand for housing is going to place continued upward pressure on prices, particularly in areas associated with the mining boom. The mining boom has driven significant rises in house prices in country Northern Territory (14.4%), Queensland (13.8%) and Western Australia (13.3%) in the year to December 2007.