What denotes prime ag land?

Is it position, soil quality or dollar value?

Really, it is any land that can be cultivated, fertilised and nurtured successfully to produce sheep, cattle (beef and dairy), other livestock, crops, horticulture and viticulture.

However, it is vital within this scenario that a producer makes a living.

A recent story in "The Trader" (Warragul & Drouin Gazette) by Philip Hopkins quoted comments by Andrew Smith, Rural Finance general manager of agribusiness.

These quotes stated rural land in West and South Gippsland had risen by 4.96 per cent in value on an annual average since 1990.

This increase is 20pc higher than the 4pc average for all rural land in Victoria.

Yes, a lot of this area of greater Gippsland is high-quality soil and produces high-quality lambs, beef, potatoes and myriad other agricultural pursuits, but this does warrant an annual 4.96pc increase in value.

Mr Smith draws his statistics from real farm sales and the Valuer-General's office of Victoria.

He also stated the median parcel size was 52 hectares.

This is small areas of high-quality and very productive land which survives only on good rainfall.

There is little cropping done there – but crops are an important and necessary agricultural pursuit.

Does the high Australian dollar value make it high-quality land?

Over the past 23 years (since 1990), the urban development east of Melbourne has been a large factor in the increasing value of this land.

But profitability is still a moot point.

Gippsland makes up only a small area of Victoria, and while parts of it produce high-quality agricultural product, most other areas of the State can be more valuable.

If only it would rain to a more consistent pattern, all could be fine.

West and South Gippsland have had a deluge of rain over the past three weeks.

Just imagine if northern Australia was to have a similar consistent weather pattern.

The soil may not be high-quality, which in government-speak is classified as ES01 land, but given water it would produce better than, faster than and in equal quality to the southern States.

Three years of drought in the north of Australia has reduced the value of land or at least seen it almost unsaleable.

However, someone can obviously see a change coming for agriculture.

Just recently a few cattle stations have changed hands in Western Australia and the Top End.

Why is this happening?

Because these people can see a future in farming in the "station country".

It will rain – every day that goes by is one day closer to that rain.

However, the continuing reduction of the breeding herd, the increasing live export trade to Indonesia and the increase in tonnage to other Asian countries all add up to these decisions.

This dry land country is not considered to be prime agricultural land but, given rain, this situation can and will turn around.

The varied opportunities of farming this country go toward the value of the land but so does the size of the properties.

Would you rather spend $2 million to $4 million on property in West and South Gippsland, for 50-150ha, or spend that money buying 1000 or more hectares of dryland?

Most of the cropping country of Victoria has had good autumn rain and more land has been sown to a variety of crops.

If nature has its way and suitable weather for cropping continues, graingrowers will have a very successful year (and they deserve it).

Will a good year make it prime agricultural land?

Certainly not by any current guidelines, but it will assist in not only in paying back some of the loans but also improving opportunities for other forms of farming.

A good grain harvest usually means cheaper rates per tonne but this will assist in feeding cattle and sheep for export and give a better chance of suppyling grain around the world.

This makes land of high agricultural value, not necessarily high-priced land that does not earn enough for a family to exist on without off-farm income.