BUMPER rainfall and a stronger Australian dollar are helping farmers with timely purchases, writes Jeff Hutton.

Equipment finance in the agricultural sector is taking a higher profile, keeping pace with the improving fortunes for farmers resulting from bulging harvests coinciding with rising prices.

 

The strengthening Australian dollar is also making it easier to buy pricey machinery.

 

Agribusiness specialist Rabobank says loan sizes are gradually increasing, recently averaging $90,000.

National Australia Bank, which has a 28 per cent share of agricultural sector lending, says it's hiring more analysts in key agricultural areas, according to The Australian Financial Review .

 

"We've seen confidence return and people are making investment decisions," says Neil Findlay, head of agribusiness for southern and western Australia.

 

"We expect that as the crop comes off, people will make some big ticket purchases."

 

"There are opportunities in areas recovering from drought and now farmers are enjoying favourable commodity prices and looking forward to a good few seasons so they need to upgrade their equipment," says Rabobank general manager country banking Australia, Peter Knoblanche.

 

Wheat prices have held roughly steady at about $US350 ($328) a tonne, about $100 a tonne more than a year ago, according to the Food and Agriculture Organisation of the United Nations.

 

The drive to boost harvests is tempered by labour shortages, Knoblanche says.

 

Advances in farming equipment can mitigate the increasing difficulties of finding workers but they aren't cheap.

 

Cotton balers, which are used to pick the crop, retail for about $800,000 and can be operated by one or two people compared with older systems which needed five or six people, Knoblanche says