Page 10 - Australian Pork Newspaper
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Rabobank senior grains analyst Cheryl Kalisch Gordon.
“Seasonal conditions in NSW have been near to ideal and in stark contrast to recent years.
Australian winter crop production outlook.
NSW would be the
Australia on track for above-average winter crop
AUSTRALIA is on track for a major recovery in grain production, with the winter harvest set to come in at above-av- erage levels, according to recently released fore- casts by agribusiness specialist Rabobank.
hectares, together with well-timed and above- average rainfall in most regions, support our ex- pectations for 28.8 mil- lion tonnes of wheat, 11 million tonnes of barley and 3.3 million tonnes of canola to be harvested in Australia in 2020/21,” Dr Kalisch Gordon said.
driving force behind Aus- tralia’s grain recovery in 2020/21 after being “the epicentre of devastatingly low grain production in recent years.”
The report said with a La Niña now declared active by the Bureau of Meteorology – for the first time since 2010 – and expected to deliver a wet spring, this would help finish crops and im- prove soil moisture in the eastern states, ahead of summer crop planting.
In its Australian Winter Crop Production Outlook 2020/2021, the agribusi- ness bank said that after three successive years of below-average production due to drought in many parts of the country, Aus- tralia’s “long-awaited grain production recovery is here” – with the nation expected to harvest 47.4 million tonnes of winter grains, oilseeds and pulses this year.
This will see Australia stage a major return to the global grains market, with Rabobank forecasting the nation’s grain exports to increase 93 percent on last year.
“NSW has gone from worst to best performer in only 12 months, to lead the pack when it comes to grain production,” Dr Kalisch Gordon said.
“Above-average spring rain will be beneficial, es- pecially for regions that had a drier July and Au- gust, though the risk of a wet harvest – especially in parts of Victoria and NSW – is heightened,” Dr Kalisch Gordon said.
This is an increase of 63 percent on last year and 16 percent above the five- year average.
“The last time Australia had export volumes in these ranges, the Aus- tralian dollar was 10 US cents higher and global grain prices were around 35 percent lower than our current forecasts for the year ahead,” Dr Kalisch Gordon said.
“Most production gains will be made in the central west, but above-average yields are also expected in the north and south of the state.
“In areas that have al- ready begun harvest, such as northern NSW, rain delays have already inter- rupted progress.
For NSW, it represents a staggering 366 percent increase on last year’s harvest, and for Queens- land 139 percent – with all grain-growing states in Australia set to record an increase in production.
“All other states are set for an average or above- average harvest, with the exception of Western Aus- tralia.
“This brings with it the real risk of downgrades to the quality of the grain which, if widespread, could have a substantial impact on the market due to the change in the quality profile of grain on offer.”
Rabobank senior grains analyst Cheryl Kalisch Gordon said in the report, “This increase not only represents a recovery, but also puts production back over average levels.”
“Both these factors will assist in moving these anticipated export vol- umes and support a good year for Australian grain farmers.”
“Here, a poor start and lower rainfall across the growing season means we expect a hit and miss year for WA, with the state’s harvest volume to come in above last year but still 10 percent below the five- year average.”
COVID concerns
“A 22 percent year-on- year increase in planted
From famine to feast
Wet spring
The report said Austral- ia’s grain sector had been able to proceed with an almost ‘business as usual’ production year, despite the upheaval caused by COVID-19.
According to the re- port, exports would be supported by a relatively- low Australian dollar – forecast to remain at around 70 US cents for the coming year – and comparatively high global grains prices.
“We expect a year-on- year lift of 12 million tonnes – a massive 366 percent increase – in grain production in NSW, which would put the state’s har- vest neck and neck with its record 2016/17 harvest.
“Above-average rainfall during later spring does, of course, introduce chal- lenges to harvest and the prospect of impact on quality.
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Page 10 – Australian Pork Newspaper, November 2020
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Challenges related to the availability of harvest la- bour and contractors were also expected to be man- aged for the most part, with forward planning and workarounds in place.
“Early season concerns regarding input availa- bility due to COVID were managed so that there were no material impacts on production and, for the most part, we expect the same with harvest,” Dr Kalisch Gordon said.
“However, the need to manage a wet harvest pe- riod without the typical labour force may deliver some regionally sig- nificant production and quality downgrades.” Market outlook
Notwithstanding the need to rebuild domestic grain stocks following drought, Australia is on track to export 19.8 mil- lion tonnes of wheat, 5.6 million tonnes of barley and 2.7 million tonnes of canola this year, Ra- bobank forecasts.
According to the report, while global wheat stocks are forecast to grow again by more than five percent in 2020/21, the location of those stocks outside key exporting nations means global prices are expected to be supported.
“With a combined 15 million tonne year-on- year reduction in wheat exports from the Euro- pean Union and Ukraine this year, the world is looking to Australia’s re- covery to help keep the market in balance,” Dr Kalisch Gordon said.
The bank forecasts Chicago Board of Trade wheat to trade around US cents 580 per bushell ($A8.18/bu) over the coming 12 months, up 12 percent year on year and approaching 40 percent higher than 2016/17, when Australia last harvested an above-average winter grain crop.

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