The ABARE report Australian beef: Financial performance of beef farms, 2006-07 to 2008-09 was released today by executive director Phillip Glyde.

"In northern Australia, above average seasonal conditions in 2008-09 are projected to allow beef producers to increase beef cattle turn-off and farm incomes," Mr Glyde said.

But the report notes that the majority of small-scale farms with 100 to 200 cattle in southern Australia operated in areas that continued to experience below average seasonal conditions in the first half of 2008-09.

These farms are still projected to increase beef cattle turn-off and reduce livestock numbers.

"However, improved seasonal conditions in other parts of southern Australia are projected to increase the average number of beef cattle per southern Australian beef farm by more than 6 per cent in 2008-09," Mr Glyde said.

On average, farm cash incomes for beef producers in northern Australia are projected to increase to more than $105,000 in 2008-09.

While the average farm cash income for producers in southern Australia is expected to increase to around $66,000 in 2008-09, farm business profits are projected to improve by a greater amount because of the increase in beef cattle numbers and on-farm inventories of grains.

"In recent years the beef industry has undergone a period of significant new capital investment, particularly to acquire land," Mr Glyde said.

"This, combined with high equity, has enabled many producers to finance their expansion."

However, the recent downturn in global and domestic economic conditions and continued dry seasonal conditions in some regions is likely to have slowed growth in land values, and in some places, led to a fall in land values.

"As a result of the fall in average farm equity ratios, because of lower land values and higher debt, some beef producers may find it increasingly difficult to gain access to debt facilities in the coming years," Mr Glyde said.