Grazing land in western NSW in high demand

Local buyers in western NSW are looking to expand their land footprints, a new report has found.

According to Colliers International‘s NSW Western Division Grazing Market Update increases in livestock prices and low interest rates have contributed to a 20% increase in land values in the region.

The report indicates that demand is outstripping supply for pastoral grazing land, with interest coming from both family and corporate buyers.

Colliers International’s top factors impacting the NSW pastoral market:

• Strong commodity prices for mutton, lambs, wool and goats. Meat sheep in particular has transformed profitability within many pastoral operations through improved lambing percentages and strong growth rates. Cattle prices are also relatively firm.
• The wool market surged to record highs throughout 2018 and early 2019. More recently however, the market has pulled back but is still considered favorable for wool growers. Offshore demand is the main market driver with demand primarily from China heavily influencing prices.
• Australia’s sheep flock numbers are at historical lows as is the national cattle herd size which is still in a rebuilding phase.
• A softening Australian Dollar has benefited commodity prices (particularly wool) however this may also increase some input costs such as diesel.
• Interest rates are low and stable.
• The market’s recognition of lower operating expenses associated with pastoral grazing in comparison with higher rainfall areas (no fertiliser or pasture development and reduced animal health treatments).

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Source: Colliers International