November 9, 2006

USDA: Australia may import grain

Australian government is currently considering importing grain, says the US department of Agriculture in its November 3 report.

The decision is based on a forecast that the 2006-07 wheat crop would be less than half last season's, and the smallest in more than a decade.

The government has been assessing almost 40 applications to import corn, sorghum and wheat to identify potential stock feed supplies for farmers facing shortages due to the prolonged drought The applications relate to bulk grain for stock feed from various countries, including the US, UK, Argentina, Brazil and South Africa to name a few, says the agency report.

Since most of Australia's winter grain-growing regions are currently in the grip of drought, the USDA forecasts production in 2006/07 to be substantially lower. Output of the three major winter grains, wheat, barley and canola, is forecast to be down by over 60 percent from last year, says the USDA citing reports from the Australian Bureau of Agriculture and Resource Economics (ABARE).

While wheat estimates for 2006-07 is around 9.5 million tonnes, down 15.5 million tonnes from last season, barley is forecast to be down 64 percent to 3.6 million tonnes and canola down 69 percent to 440,000 tonnes

Further, production and exports of winter cereal grains (wheat and barley) for 2006/07 have been reduced, according to the USDA. The forecast for 2007/08 early season summer crop (sorghum and rice), which would typically be planted from now through to November, has also been trimmed significantly.

Drought assistance worth A$560 million (US$429 million) has also been announced, according to the USDA. This is in addition to the earlier drought assistance worth A$350 million (US$268 million).

For the full USDA report, click here