Grain Update | Production takes a dive

Grain production takes a dive


Grains
Drought remains a concern with the northern NSW sorghum crops the latest to feel the burden of relentless dry conditions.

Drought remains a concern with the northern NSW sorghum crops the latest to feel the burden of relentless dry conditions.

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NSW grain prices had a softer tone last week as the Queensland sorghum harvest kicked off, and weakness in the northern grain markets trickled south.

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Farmers are well versed in the challenges and difficulties of maintaining a commercial business with the vagaries of the Australian weather.

The Bureau of Meteorology’s annual climate statement, released last week, highlighted the reasons behind the east coasts smallest grain production year in a decade.

Large areas of south-east Australia experienced rainfall totals in the lowest 10pc on record, the Bureau said, exacerbating the severe drought conditions.

It was the driest September on record, they said and the third hottest year on record.

Improved rainfall in the last quarter of 2018 offered some respite to the east coast drought, the Bureau said. 

Drought remains a concern with the northern NSW sorghum crops the latest to feel the burden of relentless dry conditions.

Australia’s wheat export pace nearly ground to a complete halt ahead of the new crop harvest as the impacts of the drought continue to be felt.

November wheat exports fell to about 300,000 tonnes in November, which was the smallest monthly wheat export total in more than a decade.

Last week ABARES forecast that Australia’s 2018-19 wheat exports would fall to a 10-year low of 10.6 million tonnes due to the ongoing drought.

Nearly all these exports will come from Western Australia, were farmers were unaffected by the drought.

Western Australia’s wheat crop is now expected to 10 million tonnes which has helped propel the state’s harvest grain deliveries above 16 million tonnes.

South Australia’s Eyre Peninsula is also expected to export around one million tonnes of wheat in the 2017-18 marketing season.

Australia’s other production zones including South Australia’s Adelaide zone, Victoria, NSW and Queensland are expected to have negligible wheat and barley exports in the coming 12 months because of the drought.

Wheat shipments are expected to climb in December as Western Australia’s wheat harvest begins to flow to overseas markets.

GrainCorp issued its final harvest report for the 2018 crop in what has been a challenging season.

Harvest activity is winding down with farmers now on the last of the crops in Victoria’s western Wimmera and Western Districts.

A further 81,600t of grain was delivered into GrainCorp’s Victorian storage network in the week to January 14.

This brought the total harvested deliveries to 1.36 million tonnes which is less than half of the 2.95 million tonnes received in 2017.

Victoria was the mainstay of GrainCorp’s grain receivals during the 2018 harvest.

GrainCorp only received 608,000 tonnes of grain deliveries in NSW, less than a third of last year, and around 110,000t of grain in Queensland.

NSW grain prices had a softer tone last week as the Queensland sorghum harvest kicked off, and weakness in the northern grain markets trickled south.

Southern NSW wheat buying ideas were $10/t lower at $430/t delivered Riverina.

Newcastle sorghum prices were $7/t lower at $375/t.

Newcastle sorghum is still demanding a $13/t premium above the Brisbane prices which reflects the uncertainty over the crop in northern NSW.

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