Page 12 - National Poultry Newspaper

Rabobank senior grains analyst Cheryl Kalisch Gordon. Australian winter crop production outlook.
Australia on track for above-average winter crop
AUSTRALIA is on track for a major recov- ery in grain production, with the winter harvest set to come in at above- average levels, accord- ing to recently released forecasts by agribusiness specialist Rabobank.
“This increase not only represents a recovery, but also puts production back over average levels.”
35 percent lower than our current forecasts for the year ahead,” Dr Kalisch Gordon said.
yields are also expected in the north and south of the state.
during later spring does, of course, introduce challeng- es to harvest and the pros- pect of impact on quality.
same with harvest,” Dr Kalisch Gordon said.
very different to 2016/17, with China’s introduction of tariffs on Australian barley effectively ruling out significant volumes being sold to that market in the near term.
In its Australian Winter Crop Production Outlook 2020/2021, the agribusi- ness bank said that after three successive years of below-average production due to drought in many parts of the country, Aus- tralia’s “long-awaited grain production recovery is here” – with the nation expected to harvest 47.4 million tonnes of winter grains, oilseeds and puls- es this year.
“Here, a poor start and lower rainfall across the growing season means we expect a hit and miss year for WA, with the state’s harvest volume to come in above last year but still 10 percent below the five- year average.”
“This brings with it the real risk of downgrades to the quality of the grain which, if widespread, could have a substantial impact on the market due to the change in the quality pro- file of grain on offer.” COVID concerns
Market outlook
This is an increase of 63 percent on last year and 16 percent above the five- year average.
According to the report, exports would be sup- ported by a relatively-low Australian dollar – fore- cast to remain at around 70 US cents for the com- ing year – and compara- tively high global grains prices.
“We expect a year-on- year lift of 12 million tonnes – a massive 366 percent increase – in grain production in NSW, which would put the state’s har- vest neck and neck with its record 2016/17 harvest.
Challenges related to the availability of harvest la- bour and contractors were also expected to be man- aged for the most part, with forward planning and workarounds in place.
As such, domestic barley stocks will grow this year, keeping local prices at a broad discount to wheat in 2021.
For NSW, it represents a staggering 366 percent increase on last year’s harvest, and for Queens- land 139 percent – with all grain-growing states in Australia set to record an increase in production.
“With a combined 15 million tonne year-on- year reduction in wheat exports from the Europe- an Union and Ukraine this year, the world is looking to Australia’s recovery to help keep the market in balance,” Dr Kalisch Gor- don said.
Canola and pulses
Rabobank senior grains analyst Cheryl Kalisch Gordon said in the report,
“Most production gains will be made in the central west, but above-average
“Above-average rainfall
The bank forecasts Chicago Board of Trade wheat to trade around US cents 580 per bush- ell ($A8.18/bu) over the coming 12 months, up 12 percent year on year and approaching 40 percent higher than 2016/17, when Australia last harvested an above-average winter grain crop.
EU import demand for canola will approach re- cord volumes this year due to a significantly below-average European rapeseed (canola) harvest for the second year run- ning – with Australia ‘in the box seat’ to provide non-genetically modified canola, the European pref- erence, to that market.
“A 22 percent year-on- year increase in planted hectares, together with well-timed and above- average rainfall in most regions, support our ex- pectations for 28.8 mil- lion tonnes of wheat, 11 million tonnes of barley and 3.3 million tonnes of canola to be harvested in Australia in 2020/21,” Dr Kalisch Gordon said.
“Both these factors will assist in moving these an- ticipated export volumes and support a good year for Australian grain farm- ers.”
“All other states are set for an average or above- average harvest, with the exception of Western Aus- tralia.
“In areas that have al- ready begun harvest, such as northern NSW, rain delays have already inter- rupted progress.
“However, the need to manage a wet harvest pe- riod without the typical labour force may deliver some regionally signifi- cant production and qual- ity downgrades.”
“Instead sales to feed- grain markets – such as Saudi Arabia, Japan and Thailand – will dominate Australian barley exports this year,” Dr Kalisch Gordonsaid.
This will see Australia stage a major return to the global grains market, with Rabobank forecasting the nation’s grain exports to increase 93 percent on last year.
NSW would be the driv- ing force behind Aus- tralia’s grain recovery in 2020/21 after being “the epicentre of devastatingly low grain production in recent years.”
Wet spring
The report said Austral- ia’s grain sector had been able to proceed with an almost ‘business as usual’ production year, despite the upheaval caused by COVID-19.
“This will mean pricing that is competitive relative to other origins of feed grain and at a discount to corn.
“The last time Australia had export volumes in these ranges, the Aus- tralian dollar was 10 US cents higher and global grain prices were around
“Seasonal conditions in NSW have been near to ideal and in stark contrast to recent years.
“Above-average spring rain will be beneficial, es- pecially for regions that had a drier July and Au- gust, though the risk of a wet harvest – especially in parts of Victoria and NSW – is heightened,” Dr Kalisch Gordon said.
“Early season concerns regarding input availabil- ity due to COVID were managed so that there were no material impacts on production and, for the most part, we expect the
Despite an increased Australian canola harvest, Australian canola prices are expected to remain supported in 2020/21.
From famine to feast
Notwithstanding the need to rebuild domes- tic grain stocks following drought, Australia is on track to export 19.8 mil- lion tonnes of wheat, 5.6 million tonnes of barley and 2.7 million tonnes of canola this year, Ra- bobank forecasts.
“NSW has gone from worst performer to best in only 12 months, to lead the pack when it comes to grain production,” Dr Kalisch Gordon said.
The report said with a La Niña now declared ac- tive by the Bureau of Me- teorology – for the first time since 2010 – and expected to deliver a wet spring, this would help finish crops and improve soil moisture in the east- ern states, ahead of sum- mer crop planting.
According to the report, while global wheat stocks are forecast to grow again by more than five percent in 2020/21, the location of those stocks outside key exporting nations means global prices are expected to be supported.
“These exports will also not replace the volumes that would have gone to China.”
Poultry farm near airport sells as development site
A POULTRY farm near the future airport at Badgerys Creek in Sydney’s west has sold for $14.5 million to buyers in the food industry, who have earmarked the site for future industrial devel- opment.
homes to 30,000 resi- dents once fully devel- oped.
to capitalise on oppor- tunities associated with the development of the airport and surrounding government infrastruc- ture totalling over $5.25 billion,” Mr Shakir said.
Line and South West Rail Link extensions, M12 Motorway and M9 Orbital.
have potential to be re- developed into indus- trial property.
The 3.96-hectare block is the first site to have been sold since the NSW government gazetted the rezoning of 6500 hec- tares of land as part of five ‘priority precincts’ in the Western Sydney Aerotropolis to provide for employment, residen- tial and environmental uses.
The poultry property at 205 Lawson Road was sold to two families in the food industry – the Barba and Putrino fami- lies – who plan to oper- ate their own businesses on the land and specula- tively develop it into an industrial site.
He said the site ben- efited from good ac- cess to major transport routes, which would be enhanced by the pro- posed North South Rail
The sale equates to a new record pricing of $366 a square me- tre, which highlights the demand for land in the area among both owner-occupiers and institutional investors looking for sites that
“The transaction sets a new benchmark for the Badgerys Creek precinct, representing a 28 percent uplift on the previous record set two years ago when the Aer- otropolis precinct maps were first issued,” Mr Sukkar said.
The block has been earmarked to be rezoned for flexible mixed use and employment pur- poses.
NSW Minister for Planning and Public Spaces Rob Stokes said the rezoning of the Aer- otropolis Core, Badgerys Creek, Northern Gate- way, Agribusiness and Wianamatta – South Creek would provide the potential for 100,000 new jobs, as well as
Mr Shakir said the sales campaign had at- tracted significant inter- est because of the scale of the site and its prox- imity to the new airport, which is due for comple- tion in 2026.
CBRE’s Elijah Shakir, Andrew Sukkar and Fa- bio Screpis negotiated the sale.
“We have a number of mandates from buy- ers seeking similar sites
Industrial use has been proposed for the poultry farm recently sold at 205 Lawson Drive in Badgerys Creek.
Page 12 – National Poultry Newspaper, November 2020
Export opportunities for Australian barley are also
“With this in mind, we expect a large number of farmers will choose to carry grain, especially barley, into 2021.”
“Despite supply renewal in Australia, we expect domestic prices to be supported by both global prices – which we expect to be near to 40 percent higher than the last time Australia had an above- average harvest – and by an Australian dollar that is lower than 2016/17,” Dr Kalisch Gordon said.
“We also expect Austral- ian genetically modified canola prices to remain supported in 2020/21, based on higher year-on- year pricing in the global edible oil complex more broadly, and potential Chinese demand for GM canola,” Dr Kalisch Gor- don said.
“This will keep prices in line with the five-year average and off the lows of 2016/17.”
Barley
According to the out- look, after successive years of drought, the gen- eration of cashflow would be critical for many Aus- tralian grain farmers this season.
Based on the outlook, with barley representing close to 23 percent of this year’s winter crop har- vest, 2020/21 is expected to be the second-highest barley crop on record (al- beit still 19 percent behind 2016/17).
“However, alongside this there is also increased on-farm storage capacity among growers, as well as the recent memory of high grain pricing due to drought while interest rates are at record lows,” Dr Kalisch Gordon said.
Cash or carry
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