Canola is the stand-out mover, with production estimated to reach a new record of 5.16 million tonnes (up 14 per cent on last year and a stellar 48 per cent above the five-year average), driven by increased planting and favourable growing conditions in many regions.
Report co-author Dennis Voznesenski said Australia’s second consecutive very large winter crop “comes at an opportune time for local growers, with global shortages and high prices for grains and oilseeds”.
“Short global supplies of grains and oilseeds will continue to support Australian prices over the year ahead,” Mr Voznesenski said.
“And although global prices can be expected to soften as new crops in different regions around the world come into play, the uncertainty that exists around seasonal conditions in grain-growing areas and the process of global grain stocks re-building will keep prices at least above the range of the last six to seven years.”
Other factors of note for this year’s winter crop include a lower supply of malt-quality barley — due to a reduction in barley planting, and particularly malt varieties — and less grain baled for hay because of export concerns due to a largely-closed Chinese hay market.
“There is also a proportion of last year’s record east coast harvest — 10 to 15 per cent —that remains on farm,” Mr Voznesenski said.
“And this will compete with the coming crop for storage space and mean more delivery and price pressure during harvest.”
Exports
Rabobank forecasts Australia’s total grain exports to increase again this year — by five per cent year on year and to include 24.5 million tonnes of wheat, 7.8 million tonnes of barley and 4.3 million tonnes of canola.
“A second very large harvest means that Australia’s stocks will now be replenished after the drought so we will be able to lift exports in 2021-22 despite production coming in lower than last year,” Mr Voznesenski said.
“We expect Australia will again be able to deliver a strong export performance into South-East Asia, with Australian wheat continuing to be the price setter across the region.
“This is due to lower prices in Australia as a result of the substantial surplus that will be available, but also favourable freight costs compared with grain from further afield — an advantage that increases in times of high-cost freight like we currently have and expect to continue in 2022.”