Three months ago a third of Australian farmers felt the farm sector economy would improve in 2020-21.

Now less than a quarter of producers have that level of optimism according to Rabobank.

The agribusiness banker's latest survey of farmer confidence has also found about 27 per cent of producers are actually pessimistic about the year ahead.

This was despite much-improved seasonal conditions which have generally kept morale buoyant across the sector during 2020.

Thanks to the dramatic seasonal improvement in much of eastern Australia after years of drought, a return to more normal productivity levels has underpinned optimism among beef, grain, cotton and dairy farmers.

However, mounting unease about the COVID-19 pandemic on overseas trade and commodity market prices has spread throughout the industry.

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Wool, grain and horticultural producers are also feeling the strain of state border closures within Australia limiting business movements and access to seasonal labour for harvest or shearing.

At the same time recent trade spats centred on Australia's biggest farm export customer, China, have also unsettled farmers, particularly grain, winegrape and beef producers.

These industries have already encountered unexpected Chinese import hurdles.

Back in March just six per cent of the farmer respondents to Rabobank's quarterly farm confidence survey who anticipated the farm sector outlook getting tougher were citing coronavirus as a factor of concern, rising to 37 per cent this month.

However, Rabobank's Australian chief executive officer Peter Knoblanche said the prospect of a long awaited good winter cropping season and the chance to rebuild livestock numbers were generally keeping farmers positive.

"Farmers are still keeping an optimistic outlook because in many areas which were so severely drought affected, this is the harvest, and this is the big spring, they've been waiting for," he said.

"For many this spring will be the season that allows them to consolidate their business position and start to catch up after years of drought.

"Crops are looking good and livestock numbers are rebuilding - all positive news for farmers on the home front."

However, the real impact from Victoria's second lockdown and restrictions on livestock processing were only just surfacing when the survey was undertaken.