Australia: Canola and wheat planted areas gain at the expense of barley

Weather variability and its impact on crop conditions varies across the main production regions. In Western Australia, where the crop looks good, conditions are drier in the north and more wet in the south. On the east coast, New South Wales received more substantial rains over the past two weeks, RMI Analytics said in their early July report.

Canola and wheat planted areas have gained at the expense of barley. The RMI analysts’ estimate of Australia’s barley crop remains at 10.4 mln tonnes, down 3.2 mln from crop 2021.

As Australia was already trailing market leading regions (Canada and France), the recent decline in the barley complex globally has been less so in Australia, but prices are still lower. Wet conditions in New South Wales could significantly alter domestic price spreads between Australia port zones as malting barley may be needed to replace normal New South Wales malting supply.

The AUD remains weaker versus USD and may support export flows for grain, but in a dropping world price market, farmer prices are feeling the full impact in domestic pricing. Terminal capacity remains a major constraint.