October 30, 2007

 

Australia's ABARE cuts 2007/08 wheat crop to 12.1 million tonnes

 

 

Ongoing poor seasonal conditions have forced a downgrading of production estimates for Australia's three major winter crops, according to a Crop Report drought update issued Tuesday by the government's commodities forecaster, the Australian Bureau of Agricultural & Resource Economics, or Abare.

 

Wheat production from a crop to be harvested by year end is now estimated at 12.1 million tonnes, down from 15.5 million tonnes on September 18 but up from actual drought-affected output of 9.8 million tonnes last crop year ended March 31, 2007, the bureau said.

 

Abare's projection is within industry expectations.

 

New crop barley production is now estimated at 5.0 million tonnes, down from an estimate of 5.9 million tonnes in September but up from an actual 3.7 million tonnes last crop year, Abare said.

 

The new canola crop will produce 900,000 tonnes, down from a September estimate of 1.1 million tonnes but up from an actual 500,000 tonnes last crop year, it said.

 

After domestic wheat demand of around 7 million tonnes is met, the balance is available for export.

 

Although the combined production forecast for these three grains of 18 million tonnes is around 42 percent below the 5-year annual average, it is still about 4 million tonnes more than output last crop year.

 

Phillip Glyde, Abare's executive director, attributed the downgrades to a continued deterioration in seasonal conditions in the critical September-October period, particularly in New South Wales and the neighbouring states of Victoria and South Australia.

 

With the exception of Queensland, pockets of northern New South Wales and southern Western Australia, rainfall in September and October was below average throughout grain belts, he said in a statement.

 

New South Wales was particularly dry with many regions recording their lowest September-October rainfall on record, Glyde said.

 

"This lack of rainfall, combined with hotter than average daytime temperatures and strong winds have led to the rapid deterioration of crop yield potential and in many areas has resulted in total crop failure," he said.

 

Many winter cereal crops have been cut for hay in an attempt to recoup some planting costs and livestock producers have also been affected by the drought with many reducing the size of herds and flocks, weighing on prices, he said.