Turnover is the sum of gross proceeds from the sales of crops, livestock, livestock products and other miscellaneous revenue, and is a good guide to the level of farm business activity. The average turnover per farm business increased by 2% to $275,000 during 1999-2000 and was due to an increase in total turnover, since the estimated number of farm businesses had increased for the first time in several years.

In 1999-2000, 24,000 or 23% of Australian farm businesses had a turnover of $300,000 or more, and contributed 66% of the total turnover of all Australian farms. Their average turnover was $778,000 and the average cash operating surplus (a measure of profitability) was $138,000. The farm business profit margin (the ratio of cash operating surplus to turnover) for these businesses was 18%.

At the other end of the scale, 19,000 farms (18%) had a turnover of less than $50,000. These farm businesses contributed only 2% of the total turnover, at an average of $33,000. These farms had an average cash operating surplus of $1,000 per farm, which equated to a farm business profit margin of 3%. 
In 1999-2000, the overall farm business profit margin was 24%, up from 20% in 1998-99.


Australian farm businesses owed a total of $26.2b at 30 June 2000, an 8% increase on 1998-99. The aggregate debt has risen steadily from $11.5b in 1986-87 when the current series of agricultural finance surveys began. There was, however, a wide range of debt levels among individual farm businesses, with a third of all farm businesses having a debt of less than $22,000 (with 20% reporting no debt), a third having between $22,000 and $200,000 and a third having more than $200,000. Overall, the median debt per farm business was $87,000 at 30 June 2000. The total interest bill for Australian farm businesses, at $2.0b, was 17% higher than in 1998-99.

The average debt to asset ratio for agricultural businesses has been trending down slowly.

However, there has been an increase in the average interest coverage of agricultural businesses, from 4.4 times in 1998-99 to 4.7 times in 1999-2000, reflecting the impact of a 25% increase in cash operating surplus and a 13% rise in interest paid.