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La Nina threatens further setbacks for Australia's weather-beset wheat crop

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Australia declared the arrival of a La Nina, raising the prospect of further rain setbacks to the country’s wheat harvest, but boding well for output of the likes of cotton and sorghum which stand to benefit from the moisture.

 

The Australian Bureau of Meteorology, announcing that the weather pattern had become “established”, said that its outlook “has been raised to La Nina, indicating that the tropical Pacific has reached La Niña levels”.

 

“Signs of La Niña in the equatorial Pacific have increased during spring,” with water temperatures in central-to-eastern areas of the ocean cooling to threshold levels of 0.8 degrees Celsius below average.

 

“Atmospheric indicators, including the Southern Oscillation Index, trade winds and cloud, also show clear La Niña patterns.”

 

‘Caused further damage’

 

The bureau added that the newly-declared La Niña will likely prove “weak and short-lived, persisting until early southern [hemisphere] autumn 2018”.

 

Nonetheless, with the weather pattern “typically [bringing] above-average rainfall to eastern Australia during late spring and summer”, that prospect could mean further setbacks to Australia’s harvest.

 

In some south east regions is suffering delays from rain, which is also seen as a threat to quality, and this after dryness which hampered yield prospects across much of the country.

 

Indeed, Abares, the official Australian crop bureau overnight, as it cut by 1.34m tonnes to 20.27m tonnes its estimate for Australian wheat output for 2017-18, highlighted the continuing tests facing producers in New South Wales, the second-ranked wheat-growing state.

 

After November rainfall “resulted in harvest delays and caused further damage to some crops… Ongoing rainfall in December may adversely affect crop quality”, Abares said.

 

‘Significant weather events’

 

Separately, Agritel, the Paris-based analysis group, noted that “rains are raising fears of quality degradation for the wheat remaining to harvest in the south east of Australia”.

 

And Sydney-based grain handling group GrainCorp reported that “significant weather events have impacted operations across southern New South Wales and Victoria”.

 

While saying that “it is too early to comment on any damage to the remaining crop”, the group added that “quality will be monitored closely over the coming days”.

 

The worries have been reflected in volatility in Sydney’s lightly-traded wheat futures market, which saw the March contract soar 3.0% on Monday, only to give back most of those gains on Tuesday.

 

‘Timely for sowing’

 

By contrast, a rainy summer would bode well for output of crops such as cotton and sorghum, which are still in early stages of development, allowing them to benefit from improved soil moisture levels, or as yet unseeded in some areas.

 

Abares overnight - raising by 138,000 tonnes to 1.98m tonnes its forecast for the Australian sorghum harvest – said that “rainfall increased soil moisture levels across northern New South Wales and was timely for the sowing of summer crops.

 

“However… further rainfall during the planting window will be critical for planting intentions to be fully realised, particularly in the north-west cropping region.”

 

Abares nudged higher its forecast for Australian cotton output too, by 12,000 tonnes to 968,000 tonnes, helped by a higher acreage estimate, down mainly to a near-doubling, to 106,000 hectares, in the forecast for sowings on unirrigated land.

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