For any sceptics of the power of high prices to stimulate crop
production, Australia is providing another example, with record soybean values
sparking an attempt to turn the country into a force in the oilseed.
Cargill, the US-based agribusiness, has opened a drive to
encourage Australian farmers to improve on the less than 40,000 hectares of the
oilseed they currently grow, leaving the nation reliant largely on imports, which reached 560,000 tonnes last year, for
The group's Melbourne-based AWB business is offering growers
a support package including a Aus$10-per-hectare rebate on – non-genetically
modified- seed and some production insurance in a drive to gain domestic supplies
to feed its three mills, one of which has a vegetable oils refining plant
And the hopes of the programme succeeding rest in part on
the elevated prices of soybeans, which on Thursday hit a record high for a spot contract of $17.80 ¾ a bushel, besides the benefits of adding
another option to growers' choice for crop rotation.
"Soybean prices are very high at the moment. That has not
always been the case," AWB spokesman Peter McBride told Agrimoney.com.
A move by Australian growers into soybeans would represent
the latest in a series of shifts which are changing the crop production and
trade map, with Brazil expected by a margin to take over leadership from the US
of world soybean exports in 2012-13, as farmers raise sowings to cash in on the
Ukraine has near-tripled corn exports in 2011-12 leaped to
gain third place among exporters, behind the US and Argentina.
Argentina itself, the seventh-ranked barley exporter three
years ago is set to be the biggest in 2012-13, with farmers switching from wheat
in the face of export curbs which have limited their ability to tap strong international
'Creatures of habit'
Australia's growing culture itself has traditionally been "pretty
much founded on wheat", Mr McBride said.
"And like most of us, farmers are creatures of habit. They like
to grow what they know because that is what they have always done it."
However, Australian growers too have shown the power of
prices in encouraging growers to break with tradition.
The country, which until the 1990s had produced less than
100,000 tonnes of canola, the rapeseed variant, now harvests more than 3m
tonnes, turning into a major exporter.