Understanding the rural debt financing behaviour of Queensland primary producers

Corrie Feldman and Michael Cole

No 285060, 2019 Conference (63rd), February 12-15, 2019, Melbourne, Australia from Australian Agricultural and Resource Economics Society (AARES)

Abstract: A quantitative Survey of rural borrowers in Queensland, released in July 2018, involving nine of the major financial institutions is used to understand rural debt financing behaviour. This paper ascertains and examines the size, quality, extent, nature and trends of rural indebtedness in Queensland and compares that to previous Survey’s at both a regional and commodity level, specifically detailing the methodology for data collection and application of the findings. It provides up-to-date figures on the level and quality of debt relating to primary production in Queensland. For policy makers, this analysis improves the understanding of how rural debt is spread across agricultural industries and regions in Queensland and the behaviour of debt financing for primary producers. Debt funding has long been the principal source of capital for Australian primary producers. Utilising results from previous Survey’s back to 1994, rural debt figures have been deflated to reflect 2017 dollars. Additionally, many factors, including market and seasonal cycles and extraneous events, impact the level of debt that a primary producer has. Despite evidence that rural debt has grown over time, there is no determinable pattern of the motivations for the increasing or decreasing level of debt from the indicators examined.

Keywords: Farm; Management (search for similar items in EconPapers)
Pages: 32
Date: 2019-02
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aare19:285060

DOI: 10.22004/ag.econ.285060

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