Extreme drought in Australia, wheat very expensive

While it seems that the weather in Europe is turning, 2018 is and will remain extremely dry. However, Europe is not the only continent struggling with drought. Australia is experiencing its worst drought in 50 years. As a result, wheat prices in the country are rising even faster than in Europe.

Australia is somewhat used to high temperatures and drought, but this year is also extreme for them. The situation is very different per region, but in Eastern Australia it is very dry almost everywhere. It is reported that farmers out of necessity have to slaughter their animals, because they have no possibilities to feed the cows.

No winter harvest
It is now winter in Australia. There is usually also an autumn and winter harvest, but it is expected that there will not be this year. The Australian Bank expects the wheat harvest to fall below 20 million tons. Rainfall in the western part of the continent, which is the largest wheat-producing region, has improved expectations somewhat.

Last year's wheat crop was the smallest in 10 years and it looks like this year's crop will be small again. The wheat price in the country is being pushed up by more demand for the product. This is because farmers need it to feed their livestock. The wheat price is currently at a staggering $282 per tonne (US dollar).

The Australian government expects 15,2 million tons of wheat to be exported. That is the lowest number in 9 years. Australian weather services say the drought in the country is not over yet. An El Niño is expected, which normally brings dry weather.

emergency aid
The government in Australia has announced that $500 million (Australian dollars) is available for emergency relief in the New South Wales region. A large part is used to support the transport of animal feed and water. The farmers receive support of up to $12.000 per company.

Anne-Jan Doorn

Anne Jan Doorn is an arable expert at Boerenbusiness. He writes about the various arable farming markets and also focuses on the land and energy market.

aj.doorn@boerenbusiness. Nl

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