The economic outlook over the next year is best described as one of gradual improvement rather than rapid recovery. While inflation and borrowing costs have eased significantly, consumer spending remains constrained, and farm businesses continue to face considerable pressure on margins. Labour costs, policy uncertainty and market volatility are likely to remain key challenges over the coming year.
Farm businesses are expected to continue to face pressure from high operating costs, labour cost inflation, policy uncertainty and weather-related challenges, which are likely to constrain profitability and investment decisions.
Domestic demand is likely to remain steady rather than strengthen despite modest projections on income growth. Consumers continue to face pressure on household budgets and are expected to remain highly focused on value when making food purchasing decisions.