Cropping market - September update - Elders Rural Services

Cropping market – September update

At a glance

  • Wheat exports from Australia are forecast to increase by 21.3pc in 2021/22 according to a revised USDA estimate.
  • Diseases to look out for this month include stem cell rot in canola and powdery mildew in cereals.
  • Patient buyers and sellers are causing the price of grain in local markets to widen.

Market fundamentals


The United States Department of Agriculture (USDA) released its latest forecast for global grain supply and demand this week. The report highlighted an increase in barley production led by Australia and Ukraine, despite large reductions to crops in Canada and Kazakhstan due to dry weather. Demand from China and Saudi Arabia is expected to remain strong.

World wheat production was revised 0.4 per cent(pc) higher in September driven by positive conditions in Australia, China and India. Australian wheat production was revised 5pc higher, driven by the forecast of a wet spring.

World wheat consumption is expected to increase by 1.1pc in 2021/22 driven by an increase in feed demand. Wheat exports from Australia are forecast to increase by 21.3pc in 2021/22, the USDA increasing their September estimate by 500,000 tonnes.

The Australian dollar (AUD) has spent the week moving in a tight range after bouncing back from a low in mid-August.

Local conditions

The Elders Weather rainfall outlook suggests multiple cold fronts will develop across the country from 25 September onwards. These are expected to bring widespread rainfall particularly in eastern Australia.

From an irrigation perspective, Elders Water Trading Update reports that water prices across the southern basin remain similar to 2020/21. Inter-Valley Trade (IVT) limits will continue to play an important role in determining water prices in 2021‑22. The Goulburn to Murray and the Barmah choke IVT limits are likely to lead to higher prices in downstream Murray catchment regions.

Pests and disease

In Western Australia mice have started to emerge in cereal crops, with baiting occurring in some instances. It’s a timely reminder to revisit monitoring techniques across the country.

In New South Wales, Albury agronomist, Desi Toohey explains “crop yield potential for the Albury area is enormous”.

However, Mr Toohey cautions that now is the time for growers and advisers to be checking and proactively managing specific disease outbreaks to protect potential yields.

“Scleractinia in canola is a major disease in the Albury area and is already widespread in parts of New South Wales, due to high winter rainfall,” he explained.

“In cereal crops, diseases growers should be managing and strategising for include; septoria, leaf rust, stripe rust, yellow leaf spot and powdery mildew. Disease prevention is the key when it comes to protective yield, curative measures can often lead to a yield penalty.”

Local price and demand

Nathan Cattle of Clear Grain Exchange (CGX)** shares his thoughts on local markets.

“Patient sellers and buyers are seeing Aussie grain markets widen,” he said.

“Many growers appear relatively comfortable with the number of sales on their books for both new and old crops, while buyers are in a similar position.’

“The backdrop of a relatively large Australian new crop harvest becoming more certain, coupled with Chicago Board of Trade (CBOT) wheat futures softening recently, and the Australian dollar bouncing off recent lows, has seen buyers pull back their price expectations in many cases recently. This has been met with many growers happy to stand aside from the market.

“Grain and oilseed values generally rallied across the nation in the last couple of weeks of August, peaking at the start of September before softening in recent weeks.

“Trades are still occurring sporadically at prices close to the recent highs as some buyers find themselves short and jump in to buy some grain and then disappear again. However, if sellers were looking to do volume, currently their price expectations are needing to be a bit lower than recent highs.”

graph-showing CGX trade prices against published bids for APW1 wheat
Graph showing CGX trade prices against published bids for APW1 wheat.
Table shows traded grain prices from Clear Grain Exchange.

*Published bids refers to publicly available data from major grain buyers.

Sources: USDA, Murray Darling Basin Authority, Clear Grain Exchange and RBA.

**Clear Grain Exchange (CGX) is a secure and independent online exchange that allows you to set a price for your grain and market to all buyers. It’s free to register and offer your grain at your price, pay nothing until your grain is sold.

The information contained in this article is given for the purpose of providing general information only, and while Elders has exercised reasonable care, skill and diligence in its preparation, many factors (including environmental and seasonal) can impact its accuracy and currency. Accordingly, the information should not be relied upon under any circumstances and Elders assumes no liability for any loss consequently suffered. If you would like to speak to someone for tailored advice relating to any of the matters referred to in this article, please contact Elders.

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