LATE season rainfall will mean extra winter crop tonnes are produced throughout the drought ravaged east coast.
A series of rain bands has delivered good rain to most parts of the nation throughout October, but from a cropping perspective, falls in South Australia, Victoria and southern NSW have been particularly important.
“The rain is going to do a lot of good, particularly in southern parts of SA and Victoria,” said Market Check head of strategy Nick Crundall.
He said the confidence there would be more grain produced than many thought three weeks ago was being reflected in east coast pricing in particular.
“You wouldn’t say markets are soft, prices are still extremely high but there has been a bit of a drop in the value of old crop following the rain.”
Mr Crundall said he expected market focus to start turning to new crop.
“We’re only about a month away from harvest starting so people are really looking at what’s coming up, they’ve generally got enough cover until the new crop starts coming online.”
While the Grains Industry Association of Western Australia (GIWA) made a big downgrade to its projected WA wheat crop, cutting its estimate 20 percent to 8.1 million tonnes, on the back of a dry and frosty September, Mr Crundall said there would be numerous east coast areas that have been boosted by the September rain.
“Places like the Riverina in NSW and the Wimmera in Victoria will really benefit from the rain.
“It probably isn’t a case of generating higher yields than previous estimates more that it will arrest the trend of cutting yield from projections, there is probably a baseline yield to work with in these areas now.”
Peter McMeekin, consultant with Grain Brokers Australia, warned, however, that even with the rain, yields were still likely to be well down on what official agencies, such as the US Department of Agriculture, were saying.
“If we work on the 20pc drop in WA then I think we will be down to wheat production around 14.5 million tonnes,” Mr McMeekin said.
“That is four million tonnes less than the official USDA figure of 18.5m tonnes.”