"Higher fodder costs and lower livestock receipts are combining to significantly reduce incomes for livestock producers this year," ABARE Executive Director Phillip Glyde said on releasing the reports Australian Beef Industry – production and financial performance to 2006-07 and Australian Slaughter Lamb Industry – financial performance to 2006-07.

Average farm cash income for specialist beef producers in southern Australia is expected to fall by around a third to $32 000. The drop in income in 2006-07 is even larger for slaughter lamb producers – down by more than half to around
$44 700.

In strong contrast to poor seasons in southern Australia, northern beef producers have generally enjoyed average to above average rainfall in the past two years. However, average farm cash income for northern beef producers is still expected to be lower in 2006-07 as beef cattle prices are below those of last year.

Even though beef producers across northern Australia have increased sales of beef cattle in each of the past two years, the increase has been relatively small as producers strive to build up herd numbers.

"By building up herd numbers, beef producers across northern Australia will be in a better position to take advantage of the relatively strong saleyard cattle prices forecast for coming years," Mr Glyde said.

Mr Glyde also pointed out that not all northern beef producers were benefiting from improved seasonal conditions.

"Much of southern, and particularly south eastern, Queensland continues to be affected by drought. Farm business profits for beef producers there are expected to be much lower there than in the rest of northern Australia," he said.

Additional data from ABARE's farm surveys, including information that allows producers to compare their performance with other producers, are available on the free web-based Beef, prime lamb and sheep industry database available on the ABARE and Meat and Livestock Australia websites at www.abare.gov.au  and www.mla.com.au