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Positive agribusiness results across Australia


8 February 2010

Australian agribusinesses performed strongly in the December 2009 quarter with every state recording positive results reports the Westpac and Charles Sturt University (CSU) Agribusiness Index released today.

“Western Australia and New South Wales had tough seasonal conditions which impacted their business performance,” Westpac’s Chief Executive Agribusiness Graham Jennings said.

“Increased spending on capital items flowed through the agricultural supply chain and the overall results lifted.”

The Westpac and Charles Sturt University (CSU) Agribusiness Index survey also reports 95 per cent of Australian agribusinesses surveyed are aware that a carbon trading system may be introduced in the future, up from 78 per cent when the same question was asked two years ago.

“Most agribusinesses are aware that a carbon trading system of some sort may be introduced in the future, and as would be expected from such an innovative industry there are some remarkable efforts underway, mostly in reducing emissions,” Mr Jennings said.

Results from the December quarterly survey are used to calculate the Economic Performance Index (EPI) based on the average of results for business performance, employment and investment indicators. The EPI ranges between -1 (worst result) and +1 (best result) where a “satisfactory” result is when the EPI is zero.

For Australia the overall EPI rose from +0.02 in the September quarter to +0.04 in the December quarter, a slight change on +0.03 for the December quarter 12 months ago.

Westpac and CSU Agribusiness Index survey co-ordinator and survey co-ordinator and CEO of CSU’s Western Research Institute, Tom Murphy, says that the supply chain either side of producers showed particularly positive results with the upstream (suppliers) sector rising to an EPI of +0.15 (from +0.08 in September) and the downstream (transport, manufacturing, wholesale and retail) sector rising to an EPI of +0.21 (from +0.16 in September). Employment, capital expenditure and investment all showed strong improvement.

“Recent rains in some parts of Australia have contributed to the overall improved results,” Mr Murphy said. “South Australia, Tasmania and Victoria all improved their performance in the December quarter. Queensland showed a fall, but its EPI is still positive.”

Mr Jennings said that Westpac is committed to helping its agribusiness customers to plan and respond to the challenges of climate change.

 “Since 1996 we’ve reduced our own carbon footprint by around 40% and we are well respected, globally for our strength on the issue of climate change. We are well placed to help educate Westpac customers about future trends on carbon trading and climate change more broadly,” he said.

For many years, The Westpac Group has been recognised as a global leader in sustainability, the most recent being the announcement during the Davos World Economic Forum in Switzerland, that the Westpac Group is the only Australian banking group to be recognised as one of the 2010 'Global 100 Most Sustainable Corporations.'