Australia Latest
01/11/11 -- Harvesting of wheat in NSW is expected to begin this week, according to the state's Department of Primary Industries.
"Timely rain in the last week of September and further rain through October has consolidated the NSW winter crop," they say. This has led to an increase in yield prospects from the 2.29 MT/ha forecast in September to 2.42 MT/ha now, they say. Even so this pegs wheat output for the state at 7.1 MMT, 19.8% down on last season's bumper crop.
Barley output is seen at 1.75 MMT, 25.4% down on last year, with rapeseed production forecast at 6.5 MMT, an increase of 2.4% and early indications are for good oil contents, they add.
In contrast, near perfect growing conditions in Western Australia this year could see wheat production there double to 9.5 MMT, potentially the second largest wheat crop in the state's history.
Well above average yields are being reported in early harvested wheat in the northern wheat belt of the state, my spies tell me.
If anything the crop here has maybe had too much rain in September/October which may lower protein levels however.
Australia Latest
07/12/10 -- ABARE surprised the market this morning by raising it's Australian wheat production estimate for this season to a record 26.8 MMT. They've tended to be on the high side of trade estimates all year, but this latest projection appears to have been met with bemusement by the rest of the trade who have been marking output (as well as obviously quality) down not up.
Whilst acknowledging that wheat quality has taken a hit recently due to heavy rains in the east, they didn't specifically quantify the magnitude of potential downgrades.
Today's estimate os almost 5 MMT higher than last season's output of 21.9 MMT, and comes on the back of record yields in most of the eastern grains belt, they say.
Again this is very reminiscent of the UK's wheat crop of 2008, which was still being harvested in northern regions at 26% moisture well into late October after a very wet summer and autumn. Despite trade production downgrades we subsequently brought in a record crop in excess of 17.2 MMT, although milling grade wheat was in short supply.
Despite today's news the overnight Globex market sees wheat continue to march higher, with the most active March contract currently up 12c.
You can read the full ABARE report here.
Australian Wheat Plantings Delayed By Dryness
It's becoming an all too familiar story down under, with lack of rainfall causing delays to planting this season's winter wheat crop across much of the country.
Western Australia state, which typically produces around 40-45% of the nation's total wheat output, has seen virtually no rain so far this month.
The warm, dry weather threatens to break records in Perth, where not a drop of rain has fallen for 18 days and temperatures are sitting 4.4C above the average 22.3C.
If forecasters are right and it doesn't rain this week, the capital will break the 21-day record on Friday for no rain, marking the driest start to May on record.
In fact the whole of southern Australia saw virtually no rain last week, the culprit is a very large and strong high pressure system that has lingered in the bight for nearly a week, says an Elders. The high will finally weaken early next week allowing cold fronts to bring showers and cooler weather to coastal areas of southeastern Australia by about Wednesday. Unfortunately, there remains no suggestion of any inland rainfall of note on the horizon, they warn.
It's a worrying start for farmers who have seen their wheat crops slashed by drought in two of the last three seasons.
One said that his farm, where he grows canola, wheat, barley and lupins, was "dry as chips". Adding that there had been no rain for months on his paddocks in Kunjin, 217km southeast of Perth.
"Without significant rain in the next few weeks we will have to look at changing our seeding program for the rest of the year," he said.
Australian Wheat Planting Begins
Farmers in Eastern Australia have begun planting winter wheat after most of South Australia, Victoria and southern New South Wales received decent rainfall totals in the last week of April.
After a week of near record cold temperatures southeastern Australia can expect milder weather to develop during the weekend, forecasters say.
On Friday morning temperatures plummeted as much as seven degrees below the May average in Victoria and NSW.
While the east of the country is rugged up in near freezing temperatures, the west coast is enjoying sunny and warm weather more typical of mid summer.
Perth is set to record at least six days in a row of plus 25 degree temperatures only weeks out from winter.
The spell could easily last until late next week which will be the longest stretch of plus 25 degree May days for Perth in at least 46 years.
This warm and dry pattern in Western Australia, which produces around 40-45% of the country's wheat, will keep farmers in the state sitting on their hands for a week or two yet. Many areas of the WA wheat belt had just 10mm or less rainfall during April.
Australian Wheat Leaps Monday
Australian wheat futures jumped A$14-18 Monday, following three consecutively higher days in Chicago.
Harvest pressure has eased in the east, with things pretty much wrapped up in NSW and Queensland, reports suggest.
In Western Australia however, the nation's largest producer and exporter, the harvest continues to lag, and is only around half done in the south of the state.
Rabobank Lowers Australian Wheat Output 1MMT
Rabobank has lowered it's 2008 Australian wheat production forecast by 1MMT to 19.5MMT.
In addition to the well-publicised problems with heavy rains is northern NSW and southern Queensland, causing quality downgrades, South Australia has also suffered quality and yield losses through dryness, they say.
Adds that "the uncertainty characterizing the market with the deregulation of the single desk this season," will make export pace slower than in previous seasons.
Australia Battered By Weekend Rains
More than 120 millimetres (4.7 inches) of rain has fallen since Friday in parts of northwest New South Wales -- a major wheat growing region.
At least one million tonnes out of an expected 20 million tonne crop were likely to be downgraded from prime quality to feed grade, officials said on Monday.
They said some crops in parts of the eastern states of New South Wales and Queensland that grow prime quality wheat had been severely damaged by wet weather last month which continued into the weekend.
Crops in the southern part of Western Australia were also at risk because of wet weather at harvest time.
"There's a lot of crop damage, anything that's left will be downgraded," said Gavin Warburton, a crop analyst at private consultancy Australian Crop Forecasters.
Mr Warburton said the rain was not likely to affect the size of the harvest but crop quality was a significant issue.
Warburton said that before rains damaged crops between 12-13 million tonnes of wheat had been expected to available for export from the 2008/09 harvest.
Australia Wheat Crop Hit By Rain
Well, they've been moaning about drought for long enough, Mother Nature has decided to have a little fun with Australian farmers by deluging them with rain, slap bang in the middle of harvest.
Moist westerly winds in the upper atmosphere, combined with an easterly flow at the surface, have caused a bullseye of rainfall that has spread from southeast QLD across the border to the NSW Northern Rivers.
Another bout of rain and strong winds will inundate southeastern Australia over the next few days, in conditions very similar to those seen last week. Instability, combined with a plentiful moisture source will see New South Wales, Victoria and Tasmania receiving decent falls from Thursday until Sunday.
The Victorian and New South Wales ranges can expect up to 50mm of rainfall in places.
Around 70% of the QLD crop is already harvested, but the remaining 30% is likely to suffer quality losses. Further south in NSW only 25 to 30% of the crop is in the barn, so quality losses there could be greater, analysts say.
Australian Harvest Latest
The grain harvest in Western Australia is progressing well, with the state's main grain storage company, Cooperative Bulk Handling Ltd., saying it has received 2.8mmt of winter grains into it's system so far out of an anticipated 10-12mmt.
In the east late widespread rains in Queensland, New South Wales and Victoria have caused some quality concerns to wheats in this region.
The canola harvest is also underway with crops in Western Australia said to be producing oil yields in the region of 42-44%, whilst crops in the east are lower, typically around 35-38% oil.
Australian Farmers Holding Onto Their Wheat
Wheat farmers across Australia are holding back their grain deliveries to AWB Ltd - and to other exporters - in the first season since AWB lost its status as Australia's monopoly wheat exporter.
The Australian Financial Review reports that farmers had committed only about 5pc or 900,000 tonnes of an expected 20 million tonne national wheat harvest so far to AWB.
AWB chief executive Gordon Davis said uncertainty created by the deregulation of the wheat export markets meant farmers were stockpiling their wheat, while they sorted out the best available price.
However, he said farmers could yet deliver more of their crop to the company.
Even WA's big CBH Group, which is in the box seat to receive the wheat in that state, is concerned, according to a report in Farm Weekly, WA.
CBH warns that the WA grain receival system is in danger of breaking down as growers delay selling grain while they shop around for the best price in the new deregulated market.
A bulk carrier fleet anchored off Geraldton, WA, for instance, remains idle this week and the CBH is concerned that unless some grain is quickly sold and moved out, the system could collapse.
CBH Group executive logistics manager Tim Collins has told Farm Weekly that farmers who have already harvested in the northern wheatbelt are waiting to get the best price in the deregulated wheat export market.
Grain from this season's harvest is starting to pour into Geraldton zone silos and there are fears the problem could spread to the WA's other grain ports, Kwinana, Albany and Esperance.
A ship arrived at Geraldton last week and another five are due this week.
The ships have a total 167,000 tonnes capacity.
Growers could be billed demurrage costs because some of the ships have been ordered by CBH subsidiaries Grain Pool and its wheat marketing arm AgraCorp.
The only consolation is that daily shipping rates have plummeted causing Panamax-size ships that cost $60,000-$70,000 daily six months ago to now charge $10,000-$15,000.
Mr Collins said while he is concerned about the cost of unused ships his main concern is how the storage system would cope if the grain isn't moved quickly.
Mr Collins said unless some of the grain is nominated quickly, the receival system could clog up and crops could have to stay in their paddocks.
"CBH has 20 million tonnes of storage capacity if you have one grade, but when you have 60-65 segregations you lose your capacity very quickly," he said.
"The system is quite literally a pipeline and so it is important that pipeline is kept open.
"If these ships don't get grain we have a significant problem.
"We don't need all grain nominated, but about 20pc-30pc."
About 1mt has been harvested in the Geraldton zone so far this harvest.
Mr Collins said the cooler weather had made matters worse because grain had not been received quickly.
Australia: Victoria Wheat Also Hit By Rain
Having been praying for rain all season, just as the combines were ready to roll, rain aplenty has arrived in Victoria.
Unfortunately, as in neighbouring NSW and Southern Queensland, its too late to help, but early enough to cause problems.
Many crops will be downgraded because of rain damage, says one agronomist.
"It's going to start swelling up and it's going to start wanting to germinate," he says.
"When that happens it either starts sending it's root out of the seed while it's still in the head."
"Then starts turning it's ezymes on to turn to start turning the starch in the grain into sugar and that totally makes the grain unsuitable for baking."
"Once that happens it renders it for feed quality."
Queensland Crops Damaged By Rains
Southeast Queensland got drenched last night with the heaviest rain in many years.
Just four days after storms brought damaging winds, hail and heavy rain to the southeast another trough has caused thunderstorms with torrential rain and damaging winds.
In just a few hours a massive 243mm of rain fell in Tallegalla, approximately 40 kilometres west of Brisbane. Although the records for this site are incomplete, 243mm smashed the previous highest record of 166mm in 1967.
In Gatton 170 millimetres was recorded, the heaviest 24hr total since 1992, and the heaviest November rain since 1898. Ipswich received 157mm, the heaviest since 1991, and largest November one-day total in 67 years.
Closer to the coast Brisbane received 79mm, their highest total since February 2004. This brings Brisbane's total rainfall for this month to 250 millimetres, already 150 millimetres above the long term average.
Analysts are saying that the rain has come at exactly the wrong time for ripened wheat ready to be cropped, and could well lead to some quality downgrades.
Reports are coming in of recently cut wheat that has "shot and sprung" (sprouted in the head) from Queensland and Northern NSW.
Wheat of this type is now only suitable for feed, which will put further pressure on barley and sorghum prices. Feed wheat is currently priced around A$70-A$90/tonne below milling wheat, traders said.
Australian Wheat Edges Lower As Harvest Progresses
Australian wheat futures are lower this morning, with ASX January down A$2.50 at A$273/tonne and ASX March A$5.70 lower at A$275/tonne.
Downwards pressure comes from last nights weaker CBOT close and also the advancing harvest.
Harvest progress in southern Queensland is estimated at 70% complete, and around half done in northern NSW.
Rains forecast today/tomorrow in the region will likely slow the harvest however, traders say.
Still, farmer selling in this part of Australia remains relatively light, with farmers concentrating on getting the harvest in and into storage.
US Attache Trims Australian Production Numbers
The U.S. ag attache in Australia says that although the wheat harvest has begun, very few results were available at the time their report was submitted.
"At time of writing, much of southeastern Australia has returned to drought conditions," says the attache. "Total wheat production for 2008/09 is forecast at 20.15 MMT, down on the 21.6 MMT previously forecast. In revising production downwards, we have cut area by 500,000 hectares and has also trimmed yield."
The attache forecast barley production for 2008/09 at 7.013 MMT, down sharply from their previous forecast of 7.875 MMT. "There remains significant scope for further reductions in forecast production for both wheat and barley," adds the attache.
Australian Wheat Exports Almost Double In October
Australian wheat exports in October were almost double year ago levels, the government's new wheat export regulator said on Thursday.
Exports were 400,000mt, up from 274,497 tonnes a year ago, with 8 newly licensed exporters participating in the sales, it said.
Wheat Exports Australia (WEA) licenced 19 exporters under Australia's new wheat
exporting arrangements, effective from July 1, which ended AWB's monopoly position that had existed for more than 60 years.
AWB lost its monopoly after being found to have broken United Nations sanctions against Iraq by paying $222 million in back-handers to Saddam Hussein.
WEA said Australian wheat had been delivered to eight different countries during the September-October period,
Australia's New Crop 2008 Wheat Exports Begin
Western Australia, the country's largest wheat producing and exporting state, sent out its first export shipment of 2008/09 season at the weekend.
The 30,000 tonne cargo left Geraldton port bound for Indonesia, shipped by the CBH Group subsidiary AgraCorp.
Rabobank left its Australian wheat production estimate unchanged at 20.5mmt Wednesday, 0.5mmt higher that the USDA projected on Monday.
Australian Wheat Output Reduced
With much of southeastern Australia returning to drought conditions, the U.S. Department of Agriculture’s Monday lowered the country’s total wheat production forecast for 2008-09 to 20.15 million tonnes, down from the previously forecast 21.6 million tonnes. The FAS also lowered the total barley production forecast for 2008-09 to 7.013 million tonnes, down from the previous forecast of 7.875 million tonnes. The FAS said there remains significant scope for further reductions in forecast production for both wheat and barley.
Despite very low or no rainfall for the month of August in southeastern Australia, many winter cereal producers in these regions had hoped for at least average or above average rainfall during the crucial period of late September and early October, the FAS said. This did not occur however, and the winter cereal producing regions in Western Victoria, Australia and Southern New South Wales, Australia are expecting a very poor harvest with many crops cut for hay or abandoned altogether.
One South Australia farmer, Fred Maynard, says the region has had only 152 millimetres of rain this year, compared to the average of 355mm, and the situation has been made worse by the recent hot temperatures and strong winds.
Mr Maynard says with the deregulation of the wheat market, selling this year's crop is even more of a challenge. "We're lost actually, we don't know where to sell, what to do, anything," he said.
ABARE Cuts Australian Wheat Output Estimate
ABARE has cut its 2008 Australian wheat crop production estimate to 19.9mmt from 22.5mmt last month, citing a lack of rainfall in the south east.
Victoria has been particularly badly affected, with ABARE slashing output there by almost half to 1.4mmt. South Australia and southern New South Wales have also been hit, it said.
Still, overall wheat production is still seen around 7mmt more than in 2007.
In a separate statement the South Australia Department of Agriculture said total grain output in the state would be 4.74mmt, 13% lower than last month's estimate. Wheat production is seen similar to 2007 at 2.34mmt, it said.
In 2007 the state produced 4.88mmt of grain, with wheat output at 2.35mmt.
Australian Wheat Harvest Begins In NSW
Hot and dry conditions have prompted farmers to begin wheat harvesting in New South Wales.
For the first time in an unregulated market growers are not compelled to sell their wheat to the Australian Wheat Board for export under the single desk scheme. This has prompted a lot of cash-strapped growers to try to sell their wheat all at the same time after two years of drought.
Not surprisingly this is depressing prices. Benchmark ASX January closed Friday A$6 lower at A$271/tonne, A$14 down on the weeks high and A$29 down on the month.
The harvest has yet to begin in Western Australia, the country's largest producing state, where soil conditions are too wet.
Australian Farmers Set To Harvest Best Wheat Crop In Years
After two years of crops decimated by drought, farmers in the northern wheatbelt areas of Western Australia are finally preparing to harvest a decent crop.
One grain silo manager said crops in some parts were the best he had seen in decades. "The last couple of years with the drought has placed a lot of pressure financially on growers, and mental demands," he said. "But this season, the spirits of the growers are high, the volumes are good and prices are reasonable."
In a year described as make or break for many debt-laden farms, some growers have reported harvesting more in one day than their entire tonnage for last season.
Andrew Thomas, who farm south-east of Mullewa, expects to harvest about 10 times the amount of grain over coming weeks that he produced last year. "It's a rewarding feeling to harvest a good crop after all that risk and effort," Mr Thomas said yesterday.
