Aggregate lending to the farm sector rose 6 percent in 2023-24, according to the latest figures released today by ABARES.

ABARES Executive Director Jared Greenville said the rise reflected ongoing capital investment and continued confidence in Australian agriculture.

”The aggregate value of outstanding loans increased from $123.6 billion at 30 June 2023 to $131.4 billion at 30 June 2024,” Dr Greenville said.

“Western Australia and South Australia saw the largest percentage increases at 12pc and 7pc respectively.

“However, while lending to the farm sector increased in all states and territories during 2023–24, the distribution of debt is spread unevenly across farms.

“In 2023–24, 5pc of broadacre and dairy farms accounted for 52pc of the aggregate value of loans in these two industries.

“The remaining 48pc of debt was accounted for by 45pc of farms.

“At the same time, around 50pc of broadacre and dairy farms were carrying little or no debt in 2023–24.”

The affordability of debt is measured by the average proportion of gross cash income consumed by interest payments – known as the average interest coverage ratio.

“Higher interest rates in 2022–23 and 2023–24 saw the average interest coverage ratio increase to 22pc for broadacre and dairy farms in 2023–24,” Dr Greenville said.

“That’s the highest it has been in a decade but still well below the peak in 2006–07 when it reached over 50pc.”

The full report and dashboard are available on the ABARES website, providing a range of detail including the total value of agricultural loans, loans arrears data, debt mediation and foreclosures.