ao link

Australia's wheat, canola exports to fall to 12-year lows

TwitterLinkedineCard

Australia’s wheat exports, besides production, are on course for a 12-year low, as are canola shipments, with barley volumes to see a 10-year bottom, thanks to crop damage from “severe drought”, Rabobank said.

 

The bank pegged Australian wheat exports in 2019-20 as ending up “in the order of 8m tonnes”, with barley shipments seen at 3.9m tonnes, and canola volumes at “less than 1m tonnes”

 

“Collectively, this would be 15% below last year’s export programme,” said Dr Cheryl Kalisch Gordon, Rabobank senior grains analyst.

 

Indeed, for wheat, a figure at this level would be the lowest since the 7.5m tonnes shipped in 2007-08.

 

For canola too, the forecast tonnage would be the smallest in 12 years, while for barley, the expected shipments would be around levels last seen in 2009-10.

 

Long-term impact?

Nor may Australian merchants return to business as usual even if the country’s next harvest revives, as historical customers become more used to supplies from other origins.

 

Exports from the Black Sea and Argentina have “already moved in to make up for Australia’s supply shortfall in key export markets”, Ms Kalisch Gordon said.

 

“Regaining market positioning will be increasingly difficult with every year that Australia does not have a buoyant export surplus.

 

“Australia’s reduced capacity to service international markets over multiple years will severely challenge Australia’s competitiveness in export markets when our exportable surplus grows again.”

 

Price prospects

She also forecast that a “significant increase in grain imports is also on the cards”, up 52% year on year in 2019-20, and a factor which would curtail prospects for gains in Australian grain prices despite weakened production expectations.

 

“A continuation of difficult seasonal conditions and still very high feed-grain demand on the east coast is expected to maintain an elevated price floor for wheat and barley.”

 

However, further imports of wheat from Canada “are expected to put a price ceiling on upside movement in the new season,”

 

Crop forecasts

The comments came as the bank slashed to 15.84m tonnes its forecast for the Australia’s nascent wheat harvest, taking it below last year’s result to a 12-year low - although a figure a little below a 15.5m-tonne estimate last Thursday from National Australia Bank, as Agrimoney revealed.

 

The barley crop was forecast at 7.71m tonnes, down 600,000 tonnes year on year, and a result which would be the weakest since 2012-13.

 

For canola, 2019-20 production was estimated at 1.83m tonnes, down 350,000 tonnes year on year, and a result would represent a 12-year low, as measured against data from official crop bureau Abares.

 

‘Ongoing severe drought’

Abares last month forecast the 2019-20 Australian wheat crop at 19.10m tonnes, supplying exports of 10.87m tonnes.

 

For barley, the harvest was pegged at 9.48m tonnes, and exports including sorghum at 70.2m tonnes.

 

For canola, production was estimated at 2.30m tonnes, and exports at 1.61m tonnes.

 

However, “ongoing severe drought conditions continue to take their toll on many of the nation’s main cropping regions,” the bank said, pegging the overall winter crop harvest at a 12-year low of “just” 27.7m tonnes.

 

“Conditions this season have proved testing even for Australia’s ‘most valuable player of the year’ last season, Western Australia,” Ms Kalisch Gordon said, pegging the state’s overall winter crop harvest at 11.9m tonnes, down more than one-third year on year.

TwitterLinkedineCard
Related Stories

Evening markets: Grains suffer touch of late-week profit taking

The likes of corn and wheat trade lower in closing deals of a positive week. But the vegetable oil complex, and canola, stay strong

Failed hold-outs may foster dairy price gains at next week's GDT auction

Futures prices suggest modest gains in the offing at Tuesday’s GlobalDairyTrade auction - for whole milk powder, at least

Soybeans vs corn deadlock breaks in battle for acres

There has been some movement at last in the new soybeans-versus-corn price ratio, seen as an influence on sowing area. Cotton stakes its claim too

Microsoft mogul makes a mint out of betting the farm

Prices of US farmland, of which Bill Gates is the biggest owner, are rising at their quickest since 2012
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© Agrimoney.com 2021

Agrimoney.com and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of AgriBriefing Ltd
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069