After 3 years of a below-average grain harvest due to the drought, Australia is now on track for a long-awaited recovery. In addition, winter grain reportedly even produces an above-average harvest. Rabobank writes this in the Australian Winter Crop Production Outlook for the 2020/2021 season.
In the report, Rabobank states that it assumes a harvest of 47,4 million tons winter grains, oilseeds and legumes. That is 63% more than last season and 16% above the 5-year average. New South Wales stands out the most. In that area, an increase of no less than 366% is expected compared to last season (in concrete terms this amounts to 12 million tons). The region has thus changed from the worst performing area to the best performing area in 12 months. This brings the harvest close to the record 2016/2017 season. The harvest forecast in the Queensland region is also significantly above last year's level: +139%.
Significant increase in exports
Rabobank expects 2020 million tonnes of wheat to be harvested in Australia in the 2021/28,8 season. The harvest forecast for barley is 11 million tons. According to the bank, these increased harvest expectations are mainly because the acreage has increased by 22%, in combination with above-average rainfall. According to Rabobank, the higher production also guarantees a strong increase in exports. Although the bank agrees that Australia must first rebuild domestic grain stocks as a result of the below-average harvests of the past three years, the country is on track to produce 3 million tonnes of wheat, 19,8 million tonnes of barley and 5,6 million tonnes of wheat this season. to export 2,7 million tons of rapeseed.
This would mean that Australian grain exports this year would be 93% higher than last season. These higher exports are supported by the relatively low Australian dollar and relatively high global grain prices. For example, the wheat price on the CBoT in Chicago closed in week 43 at $6,32 per bushel, which is considerably higher than the 5-year average ($4,94 per bushel). The bank predicts that the average price for wheat on the CBoT for the next 12 months will certainly be $5,80 per bushel. This is almost 40% higher than in the record year 2016/2017.
Significant increase in barley
Rabobank also expects the second highest barley harvest ever for Australia, although the difference with the record season 2016/2017 is still 19%. Barley now represents almost 23% of the total winter grain harvest. On the other hand, the export market for barley is less favorable than in other years. This is because China has imposed tariffs on Australian barley. Instead, it is expected that more will be exported to Saudi Arabia, Japan and Thailand this season, although these will be smaller volumes than were usually exported to China.