The quarter four survey, released Wednesday, found that while overall net rural confidence had declined slightly from the previous quarter – due primarily to concerns about rising business costs and weather uncertainty – three in four Australian farmers were still expecting operating conditions in the farm sector to either improve or hold steady over the next 12 months.
A third of farmers (33 per cent) report they are intending to increase the level of spending on their farm business in the coming year, while 55 per cent plan to maintain current levels of investment.
The survey, completed last month, shows national rural confidence sitting at net six per cent, declining from 14 per cent in the previous quarter.
Nearly half of the farmers surveyed (48 per cent) expect conditions in the agricultural economy to remain stable in the year ahead, an increase from 41 per cent with that view in quarter three.
A further 27 per cent are anticipating an improved outlook for agriculture in 2026, down from 35 per cent in the previous survey.
The proportion expecting conditions to deteriorate is stable at 22 per cent.
While confidence eased across most states and commodity sectors, Victoria bucked this trend with farmer sentiment continuing to track higher, primarily on the back of more encouraging seasonal conditions in a number of regions. Tasmanian farmers maintained their position as the most confident in the nation.
High input costs remained the leading concern for farmers this survey – cited by 37 per cent, while drought was still a worry for 33 per cent. A total of 24 per cent were worried about the impact of falling commodity prices on their businesses.
Rabobank group executive for Country Banking Australia Marcel van Doremaele said Australian farmers are overall ending the year on a steady footing.
“After a period of volatility – especially from a seasonal perspective – farmers are shifting their expectations towards greater stability in 2026, with nearly half anticipating it will be 'business as usual' in the year ahead,” he said.
“Despite some decline seen in the net national confidence index this quarter, the underlying sentiment remains resilient with most taking a measured view and balancing challenges with opportunities.”
Mr van Doremaele acknowledged concerns about business costs were tempering sentiment, as farmers take a cautious approach to the end of the year.
“Farmers across the country are concerned about the impact that high input costs are having on their farming business, with this topping the list of concerns in all states this survey,” Mr van Doremaele said.
“Farmers are facing sustained inflation across almost every major input cost, and that pressure is naturally weighing on sentiment. It's no longer just fuel and fertiliser – everything from machinery repairs to labour and insurance is tightening margins.”
The survey found 63 per cent of respondents intend to invest in on-farm infrastructure, including fences, yards and silos, while more than a third will spend on new technologies (39 per cent) and new plant and machinery (35 per cent).
The Rabobank Rural Confidence Survey questions an average of 700 primary producers across a wide range of commodities and geographical areas throughout Australia on a quarterly basis.
The next results are scheduled for release in March 2026.
