US farm officials ditched hopes of a rise in Australia's
sorghum harvest, cautioning that last month's heavy rains – while credited as a
net benefit to sugar crops, and a spur to cattle prices - may have come too
late for the grain.
The US Department of Agriculture's Canberra bureau slashed
to 1.9m tonnes, from 2.4m tonnes, its estimate of the 2012-13 sorghum harvest in
Australia, the third-ranked exporter of the grain after Argentina and the US.
The downgrade, which put a year-on-year decline of 19% in
Australian sorghum output on the cards, reflected sowing setbacks caused by the
dryness and record temperatures which preceded the inundations in the second
half of January.
It followed a caution from farm officials in New South
Wales, one of the country's two sorghum growing states, that plantings had fallen well short of previous forecasts.
In Queensland, the other sorghum-growing state, "a severe
lack of summer rainfall" delayed plantings, the USDA bureau said, noting that
only 5% of expected sowings had been completed by January.
And some of what has been sown, in both states, "suffered
from a lack of rain during the early stages of growth".
While Australia did receive heavy rains over the last two months
of January, this came late in the sorghum sowing season and "it is likely that
many growers will plant corn, sunflowers, mungbeans or chickpeas instead", the
The downbeat comments contrast with ideas that the rains had,
overall, helped growers whose crops had not been flooded out.
"With the exception of the horticultural sector, the rain
event will be positive for agricultural production," Luke Mathews at
Commonwealth Bank of Australia said.
"Australian sugarcane production will benefit, on balance,
from the increased moisture," with cotton yields also supported in many areas.
Adam Kay, chief executive of industry group Cotton Australia,
said: "While not as large as last year's record yield, this year's cotton
harvest is still expected to be a bumper crop.
"Forecasts for 2013 are for a 4m-bale crop with an export
value of $2bn."
However, livestock producers looked the main beneficiaries, after
the rains boosted prospects for pasture, encouraging restocking.
"Local cattle prices, the eastern young cattle index, jumped
6.6% higher last week to be the best performing commodity on our watch list,"
CBA's Mr Mathews said.
* Australia's weather will turn drier this week, although a "few
showers" are "possible" in New South Wales and Queensland this week, according
to MDA Weather Services.
"Dryness remains extensive across central and southern
Queensland and north central New South Wales, which has resulted in notable stress
on sorghum," the US-based weather group said.
"However, growth will be finishing up over the next few
weeks, and drier weather will now be favourable for the crop."