Capital injection for farm businesses

Coronavirus stimulus package to assist farmers and machinery dealers

Machinery
Engineer Sam McFarlane and Toowoomba Engineering managing director Nick Farquharson, with the Tilco HydraMax deep placement fertilising rig. Picture: Melody Labinsky

Engineer Sam McFarlane and Toowoomba Engineering managing director Nick Farquharson, with the Tilco HydraMax deep placement fertilising rig. Picture: Melody Labinsky

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The tide could be turning for Queensland's struggling machinery and manufacturing sectors.

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Summer rain and the federal government's stimulus package are set to turn the tide for Queensland's struggling machinery and manufacturing sectors.

Toowoomba Engineering is one of the businesses hoping to benefit, with managing director Nick Farquharson saying they had recently employed more boiler makers and were looking for fitters and a new sales person.

"That's not all on the back of the stimulus package, we've just noticed a turnaround with the weather and we're doing everything we can to maximise our opportunity," he said.

The federal government announced a number of incentives for the agricultural sector last week as part of its $17.6 billion fiscal stimulus package in response to the COVID-19 pandemic.

One of the incentives was to increase the cap on the instant depreciation deduction scheme from $30,000 to $150,000 until June 30.

Mr Farquharson felt every sector needed some stimulus given the impact of coronavirus and drought on the economy.

"We've been through our toughest 12 to 18 months that we've had over the past decade," he said.

"We're coming out the other side at the moment with the weather changing, but there is still a lot of people hurting."

Engineer Sam McFarlane said while the write-off was fantastic and promoted purchasing, they understood asset investment was a difficult ask for many farm businesses.

"Until farm businesses recover and start showing year-on-year profits again, the benefits to the end user will be less significant," Mr McFarlane said.

"Financing an equipment purchase is probably a pretty big ask at the moment but interest rates are fantastic.

"So on one hand now is the best time to do it, on the other it is difficult to motivate the purchase of machinery when things have been difficult for so long."

Farmers often made use of the asset write-off at events like FarmFest, which has been shifted from early June to October 13-15.

Mr McFarlane said the shift in dates was very sensible and eminently necessary, however they would instead organise their own field days to do demonstrations and on-site consultations.

"In these conditions, we'll take the show to them rather than insisting they come in and see us," he said.

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