Grain Prices Stay High As Feed Grains Remain Tight

The report, produced by the Australian Bureau of Agricultural and Resource Economics and Sciences, provides a summary of the outlook for crop production in Australia and analysis of productivity growth in the Australian grains industry.

Minister Ludwig said the report presented a positive outlook for the grains industry.

“Growing conditions over winter and spring were broadly favourable in Australia's major winter cropping regions and crops were generally reported to be in good condition,” Minister Ludwig said.

“World wheat and coarse grains prices are forecast to remain relatively high in 2011–12 due to the relatively low availability of feed grains. Canola production is forecast to increase by seven per cent in 2011–12 to around 2.3 million tonnes".

“World oilseed prices are forecast to increase as a result of increased imports by China, higher oilseed crush, and growth in feed demand from livestock industries.”

Rainfall of 25 to 100 millimetres was recorded in each of the winter months and boosted yield prospects, with crops looking promising across the states’ cropping zones.

“Rainfall in late August and September replenished soil-moisture profiles and provided a good boost to crops in most regions,” he said.

“Increased availability of irrigation water is forecast to result in higher cotton and rice plantings."

“However, production will be down in some areas of Western Australia due to continuing dry conditions.”

Total factor productivity growth for the cropping industry as a whole increased on average by 1.9 per cent a year between 1977–78 and 2008–09, while the estimated productivity growth in the mixed crop–livestock industry was 1.4 per cent a year.

For a copy of the report please visit www.abares.gov.au/publications.