Australia's GrainCorp raises harvest intake to 6.5 million tonnes
Receivables by GrainCorp Ltd. into its network of upcountry storages and coastal export terminals has reached 6.5 million tonnes, up from 5.0 million tonnes a week ago, Corporate Affairs Manager David Ginns said Thursday (December 11).
The wet weather in November that disrupted and delayed a harvest of winter grains, mostly wheat, in southern Queensland and northern New South Wales states eventually gave way to a stretch of good weather allowing growers to strip crops, he said.
The intake of grain, which the company doesn't own, has increased confidence that its forecast total intake this fiscal year ending September 30, 2009 - from 7.5 million to 10.0 million tonnes - will be achieved, Ginns said by telephone.
Total grain receivables for GrainCorp last fiscal year more than doubled, to 6.5 million tonnes.
The recent rainfall has also boosted prospects for a large summer sorghum crop, which is typically harvested in the first half of the calendar year. Some of this crop would be expected to enter the company's system.
The government's Australian Bureau of Agricultural & Resource Economics on Tuesday forecast national wheat production this 2008-09 crop year ending March 31 at 20.0 million tonnes, which would be up 54 percent from the previous crop and the biggest crop since 2005. Total winter grain production this crop year was estimated at 30.6 million tonnes, up 36 percent on year, much of which is available for export.
Ginns also said a high level of warehousing of grain in the company's network early in the harvest, which peaked at 90 percent, has fallen to about 65 percent, indicating that sales are starting to tick over as growers look for cash flow.
The November rainfall resulted in downgrading to feed grade of significant quantities of hard milling wheat and included the introduction of a new AH9 grade, essentially a general purpose or feed grade, but containing at least 11.5 percent protein.
This grade is still suitable for starch production and so is of higher value than other feed grains, he said. "So there is still a substantial market there and there may be some export markets for some of it...it's not as disastrous as a lot of people make out."
With 21 bulk wheat exporters accredited in Australia, many potential offshore buyers who have never bought Australian wheat are being contacted, including industrial users and flour millers, he said.
"There's nothing to logically exclude this AH9 or a proportion of it from actually being exported by one of the bulk wheat exporters to an industrial user," he said.
Some of the late rains in November in New South Wales, and more recently in the south of Western Australia, on nearly mature green crops could boost tonnage while producing a lower-quality, lower-protein crop.
"Some of the quality we've lost in the north of New South Wales is going to be picked up in the center and the south because of the rain, given that everything has been delayed by up to a month," he said.