Australia's agribusiness sector continues to take a beating, with no Australian forestry groups in the Australian Agribusiness Group (AAG) Agri-Index recording a positive result for the 2009 financial year.
"The loss of Great Southern and Timbercorp, the collapse of Gunns (and thankfully its recent recovery), recent fungal infections in Elders MIS forestry, and countless more issues have decreased investor confidence in forestry stocks dramatically," AAG said in a June report.
"It is troubling to see that no AAG Agri-Index companies involved in forestry have posted a positive result this financial year."
Elders fell by more than 61 per cent for the month and has fallen more than 90 per cent since August 2009, overshadowing Gunns' 30-day record of -37 per cent.
Elders shares dropped 45 per cent in a single day after the company released a full-year profit downgrade, while Gunns shares soared as major funds bought into the forestry company.
"The index was hit very hard by news of the Elders profit downgrade. As a result of this, between the 21 June date of announcement and 30 June the index fell by 6.2 per cent," AAG said.
The sector's performance was also hampered by the collapse of Forest Enterprises Australia (FEA) and The Ark Fund.
In May this year, Deloitte was appointed receivers of FEA's wholly-owned subsidiaries FEA Carbon Pty Ltd and Tasmanian Plantations Pty Ltd.
In the same month, McGrath Nicol administrators were appointed to Rewards Group. Rewards Group is the tenant on all of the property of listed investment firm Ark Fund (Ark).
The AAG Agri-Index was down again for June and was subsequently outperformed by the All Ords by 0.8 per cent.
Meanwhile, the index did post a positive second-half result, growing by 7.5 per cent, slightly less than the All Ords.
"With the speculation of the nature of the super profits tax seemingly over, and the improving fortunes of the few MIS (managed investment scheme) companies still operating, the 2010/11 year is looking to be somewhat brighter than 2009/10," AAG said.
