Total agricultural production is forecast to fall by 17 per cent to $78 billion in 2023-24.
The prediction is $16 billion lower than last year’s result, but would still be the third highest result on record.
The results are also driven by lower crop production values.
Crop production is expected to fall by $12 billion in 2023-24, with the winter crop total forecast to fall from record highs to 46.1 million tonnes, slightly below the 10-year average.
A national report found improvements in the southern cropping areas were expected to more than offset downgrades in northern regions.
The area planted to summer crops is expected to fall following below-average rainfall and low soil moisture levels during the early planting window.
Livestock production will also decline after price falls.
The Australian Bureau of Agricultural and Resource Economics and Sciences found falling livestock prices would lead to significant declines in incomes for beef and sheep farms.
The value of production for livestock and products will fall by 12 per cent to $31.9 billion in 2023-24.
Livestock exports will also be down slightly, falling by one per cent.
“Falling production values and incomes are also linked to declining global prices that are reflective of higher global supply," ABARES acting executive director David Galean said.
“The past three years agriculture has seen record-breaking crop production because of higher rainfall,” Mr Galean said.
“As we enter the El Niño period, we expect to see the national crop production fall from these record highs.”
Drier conditions and lower prices are expected to see strong falls in income for the average broadacre farm after three years of high returns.
The average farm cash income for broadacre farms is forecast to drop by 64 per cent to $113,000 in 2023-24.
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