Australia: Barley crop forecast reduced by 0.5 mln tonnes

As barley harvest advances in Queensland and northern New South Wales, the initial reports are validating the expected very good crop result. GrainCorp has reported the quality as �excellent� despite some rain interrupting harvest, but a clear forecast lies ahead. A lack of rain in South Australia and Victoria, and the impacts from the SE frost event have reduced RMI Analytics� estimate by 0.5 mln tonnes to 11.2 mln tonnes.

Prices have firmed slightly since early October while concerns about dryness and frost persist in South Australia, Victoria and southern New South Wales. Some helpful rains have improved prospects in Western Australia, and the result is a wider spread in prices between the east coast and west-coast. As harvest advances southward on the east-coast, there is likely further pressure on prices to come in the short-term but the downside is limited due mainly to the reduced crop in South Australia and western Victoria.