September 10, 2008

Rains boost outlook for north-east Australia's winter crop  

Beneficial rainfall in Australia's north-east has boosted the outlook for winter crops, including wheat, and lifted soil moisture levels ahead of the planting of summer crops, PrimeAg Australia Ltd. (PAG.AU) reported Wednesday (September 10, 2008)

PrimeAg farms properties centered on a series of hubs stretching between Gunnedah district in northern New South Wales and Emerald town in central Queensland, all of which received rainfall in a range of 20 mm to 70 mm in the week ended Sept. 9.

Executive Chairman Peter Corish said the rains boosted winter crops including PrimeAg's 10,000 hectares of dryland plantings, mostly wheat, and improved the outlook for 4,800 hectares of irrigated winter crops.

"This rain has also improved soil moisture profiles on the 5,500 hectares we are planning to plant to dryland summer crop, and this planting programme is scheduled to commence on some hubs in October," though the outcome for these crops will depend heavily on summer rains, Chief Executive John Stewart said in a joint statement.

PrimeAg does not have sufficient water available to irrigate all of the 6,200 hectares of irrigated summer crop it is planning, he said.

Corish said with harvesting plans for winter crops well advanced, wheat prices remain well above the long-term average despite forecasts for a record world production.

Prices are being underpinned by low stocks to use ratios that are forecast to rise only 21 percent in 2008, the second lowest level in 25 years, he said.

PrimeAg continues to forward sell winter crop production, in the process taking advantage of recent price spikes, he said.