INDUSTRY NEWS
grain galore While not reaching the heights of the record 2016–17 season, Rabobank predicts the total production of Australia’s winter crops will provide welcome respite for droughtaffected farmers
A
t 47.4 million tonnes, Australia’s total winter crop harvest is predicted to be 63 per cent greater than last year’s and 16 per cent above the five-year average, according to forecasts released by Rabobank. In its recently released Australian Winter Crop Production Outlook 2020/2021 report, the bank says Australia is on track for a “major” recovery after three successive years of belowaverage production, due to droughts in many parts. In New South Wales the grain harvest is forecast to rise by 12 million tonnes, up 366 per cent, while Queensland’s will rise 139 per cent with a 942,000 tonne increase. But a poor start and lower rainfall in Western Australia means that while the state’s harvest volume is likely to come in above the previous year’s total, it will still be about 10 per cent below WA’s five-year average. Rabobank senior grains analyst Cheryl Kalisch Gordon says she forecasts grain exports to increase 93 per cent on last year, as production returns to average levels, grain prices remain high and the Australian dollar stays low. “A 22 per cent year-on-year increase in planted hectares, together with well-timed and above-average rainfall in most regions, support our expectations for 28.8 million tonnes of wheat, 11 million tonnes of barley and 3.3 million tonnes of
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canola to be harvested in Australia in 2020–21,” she says. Of this, Rabobank forecasts 19.8 million tonnes of wheat, 5.6 million tonnes of barley and 2.7 million tonnes of canola will be exported. “The last time Australia had export volumes in these ranges, the Australian dollar was 10 US cents higher and global grain prices were around 35 per cent lower than our current forecasts for the year ahead,” Kalisch Gordon says. Rabobank also noted that while many grain farmers were keen for cash flow after many years of drought, low interest rates and memories of even higher pricing could encourage some property owners to make use of their greater on-farm storage capacity – carrying stock into 2021. Barley growers in particular might be tempted to take this course of action, with Chinese tariffs on Australian barley expected to rule out significant sales in 2020–21, which is expected to be Australia’s second highest barley crop on record. “Instead sales to feed-grain markets – such as Saudi Arabia, Japan and Thailand – will dominate Australian barley exports this year,” Kalisch Gordon says.
Above: Rabobank senior grains analyst Cheryl Kalisch Gordon
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