Farmer confidence has been declining for more than 12 months and is now at its lowest level in the six-year history of the confidence survey.Sentiment is now lower in Victoria than any other state.

The survey shows only 11 per cent of Victorian primary producers expect the agricultural economy to improve in the next 12 months, down from 13 per cent in the previous quarter.

Significantly, 76 per cent now expect conditions to worsen during the year, compared with 37 per cent with that view previously.

Rabobank Victorian state manager Mark Bennett said that with virtually all areas of the state suffering from the dry conditions, sentiment had reached very low levels.

"Livestock producers have been hardest hit in the last survey period with a dramatic weakening in confidence among beef, sheep and dairy producers," he said.

"Many livestock producers are not able to finish stock or carry normal numbers due to the lack of feed and water.

"This has resulted in higher livestock sales and falling commodity prices, which with the recent falls in livestock prices, is also negatively affecting confidence."

Dairy farmers relying on irrigation have also been affected by low water allocations and very high fodder prices.

Source: Country News