Agribusiness returns remain strong
The agribusiness sector continues to perform well despite recent market volatility, according to the latest Commonwealth Bank Agri Indicators Report.
The report has revealed that Australia’s listed agribusiness sector significantly outstripped the performance of the broader S&P/ASX 200 accumulation index for the sixth consecutive month, with the consensus being that performance would remain strong over the remainder of the year.
The report revealed that the sector had rewarded investors with returns of around 39 per cent over the past 12 months in contrast to the minus 7 per cent return from the broader market over the same period.
The Commonwealth Bank’s executive general manager, agribusiness, Jon Sutton said the consensus outlook for investors was similarly positive, with returns expected at 40 per cent.
“Although this precise figure cannot be guaranteed in 12 months’ time, it is a further indicator of the relative strength of the country’s listed agribusinesses in comparison to other market sectors,” he said.
Sutton said a driving force in the performance had been the strong summer rains, which had seen a lifting of the drought along much of the eastern seaboard.
He said global shifts in cropping trends and rising prices in key commodity markets of wheat and canola were also boosting opportunities for Australian farmers.
AUTHOR
Mike Taylor
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