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Australia’s ‘monster’ wheat harvest showing east-west divide

Australia’s ‘monster’ wheat harvest showing east-west divide

An east-west divide in Australia’s “monster” wheat harvest is showing signs of being reflected in quality too, with growing talk of relatively low protein levels in Western Australian results.

Output estimates for Australia’s overall wheat crop remain strong, with “private estimates… showing production at 31m-33m tonnes”, according to US broker CHS Hedging, rising above 30m tonnes for the first time.

Ben Skerman, origination officer at the Australian operations of grain trader Nidera, said that “we are undoubtedly facing a monster Aussie wheat crop with total national production pegged at approximately 32m tonnes”.

Strong results have been reported for barley, for which a record harvest is expected too, with industry group Barley Australia expecting the current crop to exceed significantly the high of 10.4m tonnes set 13 years ago.

East-west divide

However, the data show a divide between the bumper yields being recorded in eastern areas, and results which in Western Australia, the top grain-growing state, are being reported as falling short of such historical highs.

Last month, CBH Group downgraded its estimate for the Western Australian grains harvest, after late frosts, to 13m-14m tonnes, and stuck by that forecast in its latest harvest report, last week.

However, in the east, in New South Wales, merchant AdgVantage Commodities said that “yields have been anywhere from 3m tonnes per hectare to 5m tonnes per hectare for wheat and barley, which will go partly towards compensating on [low] prices”.

And in South Australia, ag officials have estimated the state’s wheat harvest at 6.3m tonnes, ahead of the record 6.06m tonnes set in 2010-11, while seeing the barley harvest, at 2.53m tonnes, topping the all-time high of 2.22m tonnes set three years ago.

While officials at Australia’s Abares commodities bureau in September pegged the national wheat crop at 28.1m tonnes, and the barley harvest at 9.50m tonnes, both short of record highs, they typically update their estimates in early December.

‘Western Australia the exception’

And the east-west gap appears to be evident in harvest results too, with protein levels seen as coming in above expectations in eastern areas, with prices of higher-spec wheat falling by some Aus$10 a tonne in New South Wales over the past week, according to AgVantage.

While strong-yielding crops often show depressed protein levels, extra applications of nitrogen fertilizer are being said by some commentators to have held up specifications this time.

Nidera’s Ben Skerman said that “the quality range is surprisingly holding between ASW and APW grades on the east coast”, Australian standard white wheat (ASW) and higher-protein premium white wheat (APW) being the two benchmark grades.

“Western Australia remains the exception as they are yet to bin any wheat over 13% protein,” Mr Skerman said.

‘No doubt lower protein’

CBH Group, the co-operative which handles the vast majority of the Western Australian grains crop, told Agrimoney.com it would not be commenting further on the state’s results in its next harvest report, due on Friday.

However, in the latest report, on November 24, Jason Craig, CBH general manager marketing and trading, said that wheat protein levels “would no doubt be lower this season with the 20-25% already harvested showing lower proteins.

“The market will be watching this closely as there is reasonable demand for Australian hard wheat this year, and supplies will be tight.

“Premiums continue to remain strong for hard wheat at more than Aus$35 per tonne above APW.”

(Source – http://www.agrimoney.com/news/australias-monster-wheat-harvest-shows-east-west-divide–10220.html)

Australia’s ‘monster’ wheat harvest showing east-west divide Reviewed by on . An east-west divide in Australia's "monster" wheat harvest is showing signs of being reflected in quality too, with growing talk of relatively low protein level An east-west divide in Australia's "monster" wheat harvest is showing signs of being reflected in quality too, with growing talk of relatively low protein level Rating: 0

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