The federal commodity forecaster says farmer incomes will decline this financial year.

The new Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) outlook report predicts that production levels will be hit by poor seasonal conditions, which should see farm production is fall 5 per cent to $59 billion this financial year.

But ABARES expects farmer incomes will remain high in historical terms.

The new outlook also suggest production will increase 3 per cent to $61 billion in 2018-19 before reaching $63 billion in 2022-23, with growth driven largely by livestock and horticultural industries.

The authority believes livestock farmer incomes will grow faster than the fortunes of cropping properties.

More information is available at the ABARES website.