ABARES ratchets up forecasts

ABARES ratchets up forecasts

Cropping
Crops across Australia are generally in good health in present which has led ABARES to make a bold forecast in terms of total production.

Crops across Australia are generally in good health in present which has led ABARES to make a bold forecast in terms of total production.

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ABARES has come up with a monster number in its September crop forecast, forecasting the second biggest Aussie wheat crop on record.

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THE GRAINS industry was expecting an upward revision to production estimates in the most recent Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) crop report but the forecaster has surprised with the extent of the lift.

Overall, there is an 8 per cent lift in ABARES' winter crop estimates in its September report from its June figure, driven very strongly by a whopping 2 million tonne lift in NSW wheat prospects.

Total nation winter crop production is now flagged at 47.9 million tonnes, which would be 20pc above the 10 year average if achieved.

On the wheat front, there was a 2.3 million tonne increase from June to September with the estimates now at 28.9 million tonnes, which would be the largest since 2016-17 and the third largest on record, behind 2016-17 and 2011-12.

Year on year it is a monstrous 64pc increase, with the vast majority of the increase due to the turnaround in fortunes in NSW.

ABARES executive director Steve Hatfield-Dodds said NSW made up the lion's share of projected production gains.

"Increased production in New South Wales has accounted for 60 per cent of the forecast increase in production nationally," Mr Hatfield-Dodds said.

"New South Wales production is forecast to be 14.8 million tonnes in 2020-21-that's more than a 300 per cent increase on last year and the highest since 2016-17.

He said overall production estimates were average to above average in all other states.

However, some within the industry have questioned whether the figure is overly generous, given a dry six week period in much of northern NSW and worsening crop condition in South Australia, where there was no change in production figures in the new report.

One of ABARES' major platforms for the high number was the Bureau of Meteorology (BOM) outlook for a wet spring, but there are concerns that it may come in wet too late to capture all the top end yield.

The BOM outlook also has a potentially drier forecast for Western Australia, the nation's major grain growing state.

Private forecaster StoneX came out with its own set of numbers this week, with numbers slightly below ABARES.

The wheat figure was 27.5m tonnes (ABARES 28.9m tonnes), barley was 10.6m tonnes (ABARES 11.2 m tonnes) and canola 3.25m tonnes, (ABARES 3.4m tonnes).

Nigel Lotz, GrainCorp general manager of operations, said his company, which has a footprint down the east coast, was expecting its biggest receival year since 2016-17.

"There are some good crops in the north-west places that have had very little grain over the past two years like Moree, Walgett and Coonamble and further south in the northern Riverina things look excellent, although big, bulky crops are busily sucking moisture out of the profile."

"Spring always determines exactly how much well we go but on the whole we are really well set up, even allowing for a little bit of yield potential dropping off in places over the past six weeks."

He said along with NSW, Victoria could be in line for a solid year.

"It could be just as big as last year in Victoria, while in Queensland even though it is a bit dry there is still a lot more crop than the last two years."

In terms of crop composition Mr Lotz said it was likely there would be less chickpeas due to the relatively low prices on offer, while canola plantings have been up, with prices good in that space.

However, he said it would not represent a big shift on the macro scale.

"These changes will only have relatively small impacts as most farmers work on their fixed rotation and don't change their core plant due to what is happening in the market at sowing time."

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