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Rates fluctuate as farmers face varying conditions

20 March 2012

The March Agribusiness Loan Monitor, released today by the National Farmers’ Federation (NFF), shows that only one financial institution has reduced agribusiness loan rates in the past month, while two have increased rates.

While ANZ has reduced its term loan rates by 0.14 percent since the previous Monitor, the Commonwealth Bank and Suncorp both increased rates by 0.10 percent during this time.

Chair of the NFF Economics Committee, John McKillop, said that while the Reserve Bank of Australia (RBA) kept rates on hold at 4.25 percent in March, and the majority of banks followed suit by deciding not to move rates, some bank rates continued to fluctuate.

“In many ways, this month’s rates reflect the varying conditions facing farmers across Australia,” Mr McKillop said.

“While many banks held steady, one chose to decrease rates while two chose to increase rates. Similarly, while the overall forecast for farmers across Australia is positive off the back of improved seasonal conditions and ABARES recent predictions, many are facing challenging times due to floods and commodity price fluctuations.

“At the same time, the Australian dollar remains above parity with the US dollar, and is expected to remain relatively high for the time being, bringing additional challenges to our export-dependent farmers.

“Seasonal conditions, natural disasters and the movements in Australia’s dollar are all outside the control of farmers, which is why it is critical for farmers to have accurate and up to date information about areas they can control – like their decisions about banking products, loan rates, and portability options should they wish to switch banks,” Mr McKillop said.

The NFF Agribusiness Loan Monitor for March is available here. The NFF provides this valuable tool to all Australian farmers in partnership with Canstar. The data for the March Monitor is current as of 16 March 2012.

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