Rural Business Today: Rates, Reform and Risk | July 2026
 We’ve pulled together the key developments, explained what they mean in practical terms, and highlighted where action may be worth considering before the end of July. We hope you find this edition valuable. |
01 RATES: THE ONE THING THAT STAYED STILL |
RBA Holds at 4.35% Unanimous First pause after three consecutive 25bp rises in February, March, and May |
4.35% Cash Rate Held 16 June 2026 | +75bp Added This Year Feb, Mar & May rises | 5 Aug Next Decision 2026 board meeting |
The RBA held on 16 June, unanimous, the first pause after three consecutive 25 basis point rises earlier in the year. That tightening cycle has added 75 basis points in a single calendar year. The board cited slowing consumer spending and softer housing momentum, while leaving the door explicitly open to further increases if inflation does not continue to moderate. A hold is not a pivot. For agribusiness borrowers, the read is straightforward: rates are not falling this year. Variable rate facilities are carrying the full weight of this cycle. The hold creates a brief window to review your structure without a rate decision directly behind you. What This Means PracticallyA typical $1 million variable rate agribusiness facility is now carrying roughly $22,000 more in annual interest than it was at the start of the year. Fixed rate spreads remain above variable across most of the market; that tells you what the market is pricing for the medium term. Refinance opportunities are real. Lender margins have widened, and the quality of how serviceability is presented matters more now than it has for almost a decade. If your facilities have not been reviewed in 18 months or more, the hold is the window to act. |
02 THE EXCISE DECISION: HALF THE RELIEF, ONE MORE MONTH |
16c/L Through July: Full Rate Returns 2 August |
16c/L July Rate Relief rate extended | 32c/L From 2 August Full indexed rate returns | July Fill Window Store at current rate now |
The government extended fuel excise relief into July at 16 cents per litre, half the 32-cent reduction that applied through April to June. National Cabinet endorsed the extension on 23 June. The full indexed excise resumes from 2 August. Retailers will pass that through within 24 to 48 hours of the change date. For operations with tank storage capacity, the arithmetic is simple: every litre stored at the current rate before 2 August saves 16 cents against the post-August price. The constraint is storage capacity and cash flow, but for operators who can manage both, July is the window. Fuel Tax CreditsMany rural businesses have not had their FTC methodology reviewed in years. Off-road versus on-road categorisation, heavy vehicle apportionment, auxiliary equipment use, all affect the credit recoverable. A 30-minute review with your bookkeeper or BAS agent before 2 August is worth doing. |
03 OIL: STABILISED, NOT RESOLVED |
Brent Back Near $80, Hormuz Risk Premium Remains in the Price Brent crude peaked near US$138/barrel in early April following the Strait of Hormuz disruption and has pulled back to around US$78–$82 through late June as ceasefire negotiations between the US and Iran produced results. The US EIA is forecasting Brent averaging around US$79 across 2027 if the ceasefire holds. For rural operators, the peak fuel cost environment of April and May is unlikely to return in the immediate term. The more pressing near-term cost is domestic: the excise returning to full rate on 2 August is a known, policy-driven increase that has nothing to do with where Brent trades.Fertiliser pricing has not followed oil lower to the same degree. Urea costs remain elevated, and the grains-to-fertiliser price ratio is at historically poor levels globally. ABARES' June Crop Report flags uncertainty in grower willingness to purchase additional urea for top-dressing in July and August, creating yield risk for the back end of the winter cropping season. |
04 SUCCESSION AND TRUST REFORM: THE TIMELINE IS FIXED |
Four More Weeks Gone: The Planning Window Is Shortening |
1 Jul 2027 | Pre-1985 CGT exemption ends for gains arising after this date |
1 Jul 2027 | Three-year rollover window opens |
1 Jul 2028 | 30% minimum trust tax commences |
30 Jun 2030 | Rollover window closes restructure after this date carries full CGT consequences |
The June Brief covered the trust tax reforms, CGT changes, and the pre-1985 rural property problem in full. Nothing in that analysis has changed. What has changed is context.Today's SMSF announcement is a third significant investor tax restriction alongside the CGT and negative gearing changes. For clients with multi-layered structures involving trusts, SMSFs, and residential property, the combined effect now needs to be assessed across the whole picture, not piece by piece.Every Rural Partners succession file with a pre-1985 rural property component is on a structured pre-1 July 2027 review. If yours has not been looked at in the past two months, now is the time.
Planning Timeline
Now to December 2026: Map income streams within each in-scope trust. Identify what is primary production income and what is not. Flag bucket company arrangements for priority review.
January to June 2027: Exposure draft legislation expected. Detailed restructuring analysis becomes possible. Integrated tax, legal, and finance advice.
1 July 2027: Rollover window opens. CGT and negative gearing reforms commence. Pre-1985 exemption ends for gains arising after this date.
1 July 2028: Minimum trust tax commences.
30 June 2030: Rollover window closes.
05 THE SMSF BAN: A SENATE DEAL THAT REWROTE THE RULES |
Announced 23 June 2026 No election mandate. The price of a Senate numbers deal. The Albanese Government confirmed on 23 June it has agreed to a Greens amendment banning self-managed superannuation funds from entering new limited recourse borrowing arrangements to acquire residential property. The bill is expected to pass the Senate before parliament rises on 2 July. Royal assent follows within days, with the effective ban date falling in mid-August 2026. A 45-day transition window applies for transactions already in progress at royal assent. Existing arrangements are grandfathered.
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IF YOU ARE MID-TRANSACTION: Call your solicitor and lender today. The contract date is the trigger, not settlement. Lenders are likely to withdraw SMSF residential lending products before the ban takes formal effect. Do not wait for the ban date. |
Why the Stated Rationale Does Not Hold The government argues this reduces SMSF demand in the residential market, creating room for renters and first-home buyers. The government itself confirmed SMSFs account for less than one percent of residential property borrowing nationally, and less than half a percent of new residential lending. At that scale, the demand impact on housing affordability is marginal. Every measure that removes an investor pathway reduces future supply. Negative gearing restrictions on future purchases, tighter investor lending conditions, state-level land tax increases, the CGT discount replacement, and now this, each framed as protecting renters. The collective effect is to reduce the pool of investors who can make residential investment stack, while immigration-driven demand continues to compound. Rents rise when supply cannot keep pace.
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"At a time of housing shortages and rental pressures, the focus should be on encouraging investment that increases housing supply, not discouraging it." — MFAA, AFIA and CAFBA joint statement, 23 June 2026 |
The Deeper Problem: How the Rule Was Made This change was not in the budget. It was not in Labor's election platform. It was extracted by the Greens as the price of Senate support for unrelated tax legislation. Treasurer Chalmers described it as reflecting the realities of the Senate. That is an honest statement. It is also a description of how multi-year financial structures built around settled rules are being rewritten by whatever deal can be assembled in the upper house on any given afternoon. The ban itself is manageable with planning. The method of making it is the real cost. When investment rules can change at this pace and by this process, the uncertainty becomes a standing tax on every decision that requires a multi-year horizon. Where Does the Capital Go? The question every affected investor now faces is where to redirect savings that cannot sit idle. Cash is not the answer. At 4.35%, the effective return inside an accumulation fund on a term deposit is around 3.7% after the 15% super fund tax on interest income below inflation. That is not conservative. It is a managed retreat. Structured alternatives worth working through with your advisers: – Rural land and agricultural property. The ban is residential-only. Rural and agribusiness land remains accessible inside an SMSF. Commercial property borrowing via LRBA is unaffected and remains one of the most tax-effective structures available. – Business real property. Holding your business premises inside the SMSF via LRBA is untouched. The property is leased back at market rent, the fund receives concessional tax treatment, and the asset builds equity inside the retirement vehicle. – Agribusiness investment structures. Farmland trusts, agribusiness managed investment schemes, and listed agricultural vehicles provide property-like exposure without direct ownership or borrowing. Quality and transparency vary. Selection matters. – Private credit and infrastructure. For investors with longer time horizons and appropriate risk profiles, managed exposure to essential services infrastructure and private lending markets can deliver income returns that cash cannot match. – Direct equity in rural business. Succession-driven ownership transitions are creating entry points. Structured with proper legal and tax advice, a stake in a profitable rural enterprise can be both income-producing and growth-oriented.
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IF YOU HAVE AN SMSF → Existing residential LRBA: grandfathered. Nothing changes for that arrangement. → Planning a new residential purchase via SMSF: the window closes mid-August. Move to contract exchange now if you are mid-process. → Reviewing your SMSF investment strategy across all recent changes: your adviser, accountant, and solicitor need to work across the whole picture. That is the conversation Bullagreen facilitates. |
05a JOINT OWNERSHIP: THE DEATH AND DIVORCE TRAP |
Grandfathering attaches to the individual interest, not the propertyThis is the element of the CGT and negative gearing reforms that has received the least public attention and carries serious consequences for ordinary investors who believe they are fully protected. The grandfathering that applies to investment properties held before 12 May 2026 is not attached to the property; it is attached to each individual owner's interest, acquired at a specific date. When that interest changes hands, for any reason, including an involuntary one, the receiving party's acquisition date is the date of transfer. |
Half Inherited Share Not grandfathered post-death | Half Divorce Transfer New acquisition date applies | None Legislative Fix No carve-out in current bill |
Scenario One: Death of a Co-Owner Where a jointly-held investment property passes the deceased's share to the survivor, the survivor acquires that additional interest as at the date of death. If death occurs after 12 May 2026, the surviving owner holds two interests in the same property: their original grandfathered share, and the inherited share acquired post-Budget. The practical consequence for a couple who jointly purchased an investment property in 2018 is stark. After the death of one partner, the survivor holds half the property under the old rules and half under the new rules where rental losses are quarantined to residential property income only from 1 July 2027, and post-2027 gains are subject to cost base indexation and the 30% minimum tax. The property has not been sold. The tax position has changed permanently from the day of death forward. A spousal rollover defers any immediate CGT liability on the transfer itself. That is a separate mechanism. The rollover does not carry forward the deceased's acquisition date for negative gearing purposes. The current bill contains no provision treating an inherited interest as retaining the deceased's original acquisition date. The gap is real and has not been addressed.
Scenario Two: Divorce and Property Settlement A Family Court order or binding financial agreement that transfers one party's interest to the other produces the same result. The receiving party acquires the transferred share at the settlement date, a post-Budget acquisition. The Family Law Act rollover defers the CGT event on transfer but does not preserve the original acquisition date for negative gearing purposes. A settlement that looked balanced before Budget night may not be balanced when modelled against the new rules. The tax value of a grandfathered property is now higher than an equivalent post-Budget acquisition, and that difference needs to be factored into any settlement involving jointly-held investment property.
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WHAT TO DO NOW → Review your will and estate plan. If jointly-held investment property is material to your estate, your solicitor and accountant need to work on this together before 1 July 2027. → Review any separation or property settlement in progress. The timing and structure of any transfer now carries a permanent tax consequence that did not exist before Budget night. → Do not assume a legislative fix is coming. The gap has been identified and industry bodies are raising it. Whether an amendment arrives before 1 July 2027 is genuinely uncertain. → Bullagreen identifies the issues, maps the complexity, and brings the right professionals into a coordinated conversation. |
06 PARAQUAT AND DIQUAT: 29 YEARS, ONE DECISION |
APVMA Final Ruling: 23 June 2026 Both chemicals remain registered. The conditions have changed materially. |
80% Rate Reduction 1,150 to 231 g/ha max | 2 years Phase-out Period Existing stock transition | 1997 Review Opened 29 years to final ruling |
The APVMA handed down its final decisions on paraquat and diquat on 23 June 2026, closing a review that opened in 1997. Both chemicals remain registered for use in Australia. That outcome matters to the broadacre sector, the fear of an outright ban has been a material planning consideration for cropping operations for the better part of a decade. That uncertainty is now resolved.
The APVMA found the weight of evidence does not show that paraquat exposure through approved uses increases the risk of developing Parkinson's disease. That is the central finding that advocacy groups had pushed hardest to reverse, and it held through the full review process.
What Has Changed Maximum application rate cut by 80%. The previous maximum of 1,150 g/ha has been reduced to 231 g/ha for standard broadcast applications. A higher rate applies to technology-assisted optical spot spraying, where application is capped at 30% of total area treated. Backpack sprayers phased out. Use of paraquat and diquat via backpack sprayers will be phased out entirely. This is the most operationally significant change for smaller operations using these chemicals for spot work, fencing lines, and infrastructure maintenance. Enclosed mixing and loading systems required. All uses require enclosed mixing and loading systems to protect operators from acute exposure. This is a capital and process change for operations using open mixing procedures. Enhanced PPE requirements apply across all uses. Pulse crop-topping withholding period extended. The withholding period for pulse crop-topping has increased from seven to 14 days. Update your harvest management calendar accordingly. New labels from 23 June 2026. New registration conditions apply to all products manufactured from this date. Existing stock is subject to a two-year phase-out period. The window is real but it is not indefinite.
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"These farming systems have driven significant productivity gains over recent decades while reducing soil erosion, improving moisture retention, lowering fuel use and supporting more sustainable grain production." — Andrew Weidemann, Grain Producers Australia, 23 June 2026 |
ACTION ITEMS FOR OPERATORS → Review current application rates. If your program runs above 231 g/ha on broadcast applications, your label compliance changes with product manufactured from today. → Audit backpack sprayer use. Identify every use case where paraquat or diquat is currently applied via backpack. Each needs a compliant alternative before the two-year phase-out closes. → Assess enclosed mixing and loading requirements. Determine whether your current setup meets the requirement. Where it does not, that is a capital planning item for the next 12–24 months. → Update pulse crop-topping protocols. The withholding period has doubled to 14 days. → Check existing stock. Know what you have on hand and when it was manufactured. Keep your records. → Update your WHS documentation. New chemical handling protocols, enclosed mixing requirements, and enhanced PPE obligations must be reflected in your SWMS, inductions, and contractor briefings. |
07 CATTLE: EYCI CRACKS 1,000C |
Restocker Demand Driving the Move First time above 1,000c/kg cwt since 2022 |
1,000c+ EYCI Through the barrier | +171c vs Last Month Per kg cwt | +290c vs Last Year Year-on-year gain |
The Eastern Young Cattle Indicator broke through 1,000 cents per kilogram carcase weight this month for the first time since 2022, sitting 171c/kg above last month and nearly 290c/kg above the same time last year. Roma led volume with over 5,300 head averaging 1,010c/kg. Gunnedah, Carcoar, Singleton, and Scone all cleared 1,000c. Widespread rain across the Central West tightened supply simultaneously with bringing restockers back into the market hard. The combination tipped the price. MLA's Simon Quilty forecasts the EYCI peaking at 1,277c/kg through this cycle, with feeder steers reaching 630c/kg liveweight as a new average. The demand-side story remains intact: the US herd is at a 74-year low, and Australia is actively filling supply gaps in Japan, Korea, and China. The watch point is China's safeguard quota, which was 90% exhausted by 1 June. Once filled, a 55% tariff applies, creating near-term disruption. Quilty sees the broader demand story as firmly intact through 2027. For producers who destocked hard, restockers are expensive now. For those who held, discipline is paying off. For those carrying debt against livestock assets, this is the window to have a serviceability conversation with your lender. The forecast has improved materially and quickly. |
08 WHS: THE INSPECTION SEASON IS HERE |
Inspections Up Across Every Jurisdiction: Agriculture Remains a National Priority Industry Agriculture is one of six national priority industries under the Safe Work Australia framework, and the past 12 months have seen a step-change in proactive inspection activity in every state and territory. SafeWork NSW targeted agricultural workplaces across regional NSW from March to May 2026, visiting 25 businesses, inspecting 76 items of plant, and issuing improvement notices to 11 of those 25 operations. That rate is the new baseline, not a one-off. WHSQ ran a statewide moving plant campaign through the final quarter of 2025. WorkSafe Victoria has set targets of a 30% reduction in workplace fatalities and a 20% reduction in injuries over five years, with explicit intent to use criminal charges for serious breaches. SafeWork SA is running a targeted agriculture audit program through to October 2026 against 30 farm businesses with high injury claim histories. The paraquat and diquat changes above add a direct WHS layer. New chemical handling protocols, enclosed mixing and loading requirements, and enhanced PPE obligations are all SWMS and induction documentation items. A regulator arriving at your gate after 23 June 2026 will expect your chemical handling documentation to reflect current APVMA label conditions. Generic documents printed before today do not. |
Tier 1 Fact-find and gap analysis. Honest read on where your current position sits against regulator expectations. Sets the foundation. | Tier 2 Right-sized documentation system built around your actual operations not a generic template. | Tier 3 Ongoing partnership for larger operators with employee and contractor complexity. |
09 THE HR LAYER MOST OPERATORS ARE MISSING |
Contracts, Classifications, and the Quiet Risks WHS is the part of the people conversation that has had public attention. The HR layer underneath it has no and it is consistently where we find the highest concentration of unaddressed risk on otherwise well-run rural businesses. The most common issues, in order of frequency: Employment contracts not updated in years. Fair Work changes through 2024 and 2025 moved the goalposts on casual conversion rights, fixed-term limits, and unfair dismissal jurisdiction. Contracts written before those changes do not reflect them. The risk surfaces when a separation is in motion. Casual versus permanent classification. Long-term casuals on a regular hours pattern have a right to request conversion to permanent employment. Treating someone as casual on paper and permanent in practice is no longer a defensible position. Contractor versus employee. The Closing Loopholes reforms have materially changed the test for genuine contractor status. Misclassification exposes the principal to unpaid superannuation, leave entitlements, award penalties, payroll tax, and potential sham contracting penalties. Family arrangements.The son on the farm paid sporadically. The spouse drawing trust distributions with no contract. The brother at harvest paid in kind. Each may be legitimate. Each may also carry tax, super, workers compensation, succession, and family law implications that have never been thought through. Through Bullagreen People and Performance, we run a 90-minute HR fact-find covering all of these items. The output is a one-page risk register with each item rated, a recommended order of fix, and a clear view of which items need an employment lawyer, which need a bookkeeper, and which Bullagreen can address directly. |
10 PAYDAY SUPER: LIVE FROM 1 JULY |
This Is Not a Future Risk From 1 July 2026, superannuation contributions must be paid at the same time as wages not quarterly. If your payroll cycle does not already do this, you are in breach with every pay run that goes out without super attached. The obligation applies to every employer regardless of size, sector, or workforce type. There is no minimum threshold exemption for casual or seasonal workers.
ATO enforcement is active. Superannuation guarantee charge liabilities are non-deductible, accrue interest, and trigger administrative penalties. The cost is not just the unpaid super, it is the multiplier on top. If super has historically processed quarterly via a batch, that needs to change now.
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COMPLIANCE: This obligation commences 1 July 2026. Every pay run from that date that goes out without same-cycle super attached is a breach. If it is not set up, it needs to be done today. Call your bookkeeper or payroll provider now. |
11 WHAT TO DO NOW |
The Practical Order of Priority Immediate — Act This Week 1. SMSF mid-transaction. If you are acquiring residential property inside your SMSF using borrowed funds, call your solicitor and lender today. The contract date is the trigger. Move to exchange immediately. Lenders may withdraw SMSF residential products before the legislation passes. 1a. Joint investment property: death or divorce.If you jointly own an investment property acquired before 12 May 2026 and you are currently dealing with a separation, a property settlement, or estate planning after a bereavement, the grandfathering position on the transferred share is not what you may assume. Get tax and legal advice before any transfer is finalised. 2. Payday super.Confirm super is being paid same-cycle with wages from 1 July. If it is not, that is a live compliance breach from that date. Fix it before the next pay run. 3. Paraquat and diquat review. Check your application rates against the new 231 g/ha maximum. Identify every backpack sprayer use case. Assess your mixing and loading setup. Update pulse crop-topping schedules to the 14-day withholding period. Before 2 August 4. Fuel positioning. Consider filling storage tanks at the current 16c/L relief rate before the full excise returns. Run a fuel tax credit methodology review before the rate change. 5. Facility review.The RBA hold gives you a window without rate pressure. If facilities have not been reviewed in 18 months or more, use it. Lender spreads have widened and the quality of serviceability presentation matters more now than it has for almost a decade. 6. Cattle marketing. EYCI above 1,000c/kg with active restocker demand is a marketing window. If the livestock position is structurally heavy going into winter, current prices provide flexibility that may not be there in three months. Through the Second Half of 2026 7. SMSF investment strategy.If the ban has closed a pathway in your forward plan, that conversation needs to happen now with your adviser, accountant, and solicitor. Cash is not the answer. 8. Trust structure review.Begin income-stream mapping on any in-scope discretionary trust. The exposure draft legislation will land. The planning window will be shorter than the analysis requires. 9. Succession timing.Any transaction in train should be tested against the 1 July 2027 CGT commencement. The optimal structure and the optimal timing may not be the same answer. 10. WHS and HR fact-find.The inspection regime is not slowing down. The chemical handling changes add a new documentation layer. The HR risks are compounding. A 90-minute structured review is a proportionate response to all three.
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The RBA was the only institution that held still this month. Everything else moved. The SMSF rules changed by Senate deal. A 29-year herbicide review closed. The excise relief was extended at half rate before the full cost returns in August. The cattle market cracked 1,000c for the first time since 2022. None of this resolves in one quarter. This is the operating environment. The businesses that perform through it are the ones who map the changes, review their structures deliberately, bring the right professionals into a coordinated conversation, and make decisions with clear information rather than deferring until the runway closes. — The Bullagreen Brief, July 2026 |
12 GOVERNMENT PROCUREMENT: YOUR TAXES, THEIR RULES |
Laws Rushed Through Without Inquiry. Construction Contracts Tilted. Regional Operators Left Out Twice. The Australian Financial Review reported this week that legislation restructuring Commonwealth procurement rules for government-funded construction is expected to pass parliament before it rises on 2 July, guillotined through without a Senate inquiry into its contentious provisions. The legislation, secured with Greens support, introduces conditions that critics, including peak industry bodies and the Coalition, argue are designed to advantage the CFMEU in the tendering process for publicly-funded construction. Whether or not that characterisation is accepted, the practical effect is the same: the rules governing who gets government construction work and under what conditions are being rewritten at speed, without open scrutiny, and without the input of the businesses that will operate under them. Why This Matters to Rural and Regional Operators This story is being reported as a capital city construction issue. It is not. Rural and regional businesses, earthmoving, civil contracting, plant hire, infrastructure maintenance, frequently tender on or subcontract into government-funded projects: roads, flood recovery, irrigation infrastructure, regional housing, community facilities. The procurement conditions attached to those projects flow all the way down the supply chain. More broadly, your clients' tax dollars fund the infrastructure spend these procurement rules govern. That spend is already heavily weighted toward capital city projects. Layering closed or union-preferred procurement conditions on top of that creates a compounding disadvantage for regional operators competing for work their taxes helped fund. |
2 July Parliament Rises Legislation expected to pass before recess | No Inquiry Senate Process Debate guillotined — no committee review | 3rd Change This Month Alone SMSF ban, CGT reform, now procurement |
The Pattern, Not Just the Policy This is the third significant rule change in as many weeks made by Senate deal rather than election mandate. The SMSF residential borrowing ban was extracted by the Greens as the price of support for separate tax legislation. The CGT and negative gearing reforms were not in Labor's election platform. Now procurement conditions are being rewritten without inquiry. The individual measures are each manageable with the right advice. The method of making them is the compounding cost. Multi-year business decisions, capital investment, succession timing, tender strategy, entity structure, are being built on a foundation of rules that can be rewritten by whatever Senate deal can be assembled on a given afternoon. That instability is a tax on every decision that requires a medium-term horizon. It falls hardest on the people furthest from the room where the deals are made.
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Rural operators are not opposed to fair procurement. They are opposed to procurement rules written without them, for a problem that was never theirs to fix. — Bullagreen Rural Specialists Group |
What To Watch If you tender or subcontract on government-funded projects:speak with your legal adviser about how changed procurement conditions may affect existing or upcoming tender responses. If you operate in construction, civil, or plant hire:monitor whether state government procurement frameworks follow the Commonwealth lead. Several states have signalled alignment. If you are structuring a business for the medium term: the speed and method of these changes reinforces the case for structures that provide flexibility. Bullagreen maps the exposure and helps you build for it. |
Want to talk through what this means for your operation? |
We are here to help navigate the conversation and bring the right people around the table.
James Brouff Founder and Group Managing Partner james@bullagreen.au | 0461 374 585 | bullagreen.au FINANCE | CONSULTING | PEOPLE Be Better. |
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