Trade

Results of the quarter two Rabobank Rural Confidence Survey, reveal optimism about high agricultural commodity prices and the prospect of a third consecutive bumper grains harvest has been reined in by the increasing cost of vital farm inputs such as fertiliser, fuel, freight and machinery and broader inflationary pressures in the Australian economy.

The latest Government figures show agricultural exports reaching a record $64.9 billion in 2022-23, but National Farmers’ Federation President Fiona Simson says these positive numbers conceal the "cost of farming" crunch impacting farmers and consumers.

The international coalition of farm organisations, Cairns Group Farm Leaders, has highlighted the need for urgent agricultural trade reform to meet global challenges of food security, climate change and hunger ahead of the World Trade Organisation (WTO) ministerial conference and a Cairns Group WTO meeting.

Indonesia has 280 million people of which 38 million are farmers. Between them have 16 million cattle and 9 million pigs spread across 6000 inhabited islands, extending 5,500km East to West and 1,800km North to South. As the borders open and the world starts travelling again, we can look forward to the return of the 50 flights a week between Bali and Perth.   Each of these flights will carry the risk of the transmission of Lumpy Skin and Foot and Mouth Disease into Australia.

Australia is laying the groundwork for a third consecutive bumper harvest, with this year’s total planted crop area forecast to reach a record 23.83 million hectares, Rabobank says in its just-released 2022/23 Winter Crop Outlook ... Locally, the bank says, “hopes are on” another large winter crop to allow Australian farmers to secure good margins in the face of high costs for inputs including fertiliser, fuel, freight and agrochemicals.

Ongoing inflationary pressures, a weaker global economic outlook and the prospect of a wet winter across many production regions of Australia is causing volatility for the agriculture sector... NAB Senior Agribusiness Economist, Phin Ziebell, said Australian agriculture was facing a number of opportunities and risks as a result of current global conditions.

The outlook shows 2022/23 may be the first year since 2012/13 in which the world has to consume less grain than the previous year – due to high prices and low supply, says Rabobank senior commodities analyst Cheryl Kalisch Gordon.   “This is forecast to be a drop of only 0.1%, but that compares to average annual growth of 2.1% over the past decade,” she said.

RaboResearch general manager for Australia and New Zealand Stefan Vogel said, in particular, there are four specific impacts of the lockdowns in China that are set to have increasing ramifications for Australian agribusiness – disruptions to freight logistics, Chinese corn plantings, dairy demand and hog pricing.

A Charles Sturt University agribusiness expert suggests Australia can anticipate an increase in wheat exports to countries affected by the Ukraine-Russia conflict and should target those importing nations’ requirements.

Exports of Queensland-bred Calypso ® mangoes to China have increased this season despite the many recent challenges faced by growers, including unpredictable weather events and freight disruptions.

The global wine sector is facing significant disruptions in different links of the supply chain. The common assumption was that these issues were transitory. Now there are increasing signs that some of these changes are structural and could even get worse, requiring more strategic responses.

Castlemaine local, Stefan Dannhausen, is set to become the Goldfields region’s answer to the Easter Bunny, having launched his new owner-managed business, Dimpex Import and Wholesale. Interested in starting out on his own but initially unsure what type of business he wanted to run, Stefan drew on fond memories of enjoying SCHO-KA-KOLA with his family as a child to come up with a business idea that allowed him to explore his German heritage.

A consortium, led by the Global Maritime Forum and consisting of BHP, Rio Tinto, Oldendorff Carriers and Star Bulk Carriers Corp., have today signed a letter of intent (LOI) to assess the development of an iron ore Green Corridor between Australia and East Asia.

The Territory Labor Government will introduce legislation this week to facilitate the $30 billion Sun Cable Australia-Asia PowerLink project ... The Solar Project (Australia-Asia Power Link) (Special Provisions) Bill 2022 will provide certainty that key commitments in the Territory’s Project Development Agreement with Sun Cable will be met. The legislation will clarify and streamline existing processes, increase project certainty, and support Sun Cable to secure project financing.

New Agribusiness Australia analysis shows a rapidly evolving global trading environment, with profound, radical implications for grains production and markets. Major consumers of grains and oilseeds are in urgent need of supply and are being forced to compromise to maintain food security.

Mark Allison, Chair of Agribusiness Australia, analyses the state of play for Russian-Australian trade and what the Ukrainian conflict may mean for key global commodities.

Farmgate milk prices have increased significantly across the world’s major dairy export regions and further “upside” in milk prices remains, Rabobank says in its latest Rabobank Global Dairy Quarterly report. The report says that even before the Russia-Ukraine conflict, global dairy commodity prices were “soaring” due to a global supply shortfall.

Australia wheat farmers can expect increased farmgate prices following Russia’s invasion of Ukraine, although the local impact is not expected to match that seen globally. Together, Russia and Ukraine make up nearly 30% of global wheat exports. Ukraine’s military has suspended commercial shipping at its Black Sea ports, which is tipped to disrupt the supply chains of grain and oilseeds exporters.

ABARES Executive Director Jared Greenville said the latest ABARES Insights report: Snapshot of Australian Agriculture 2022 demonstrated that while there have been fluctuations, the agriculture sector was still on an upward trajectory.

NSW Minister for Enterprise, Investment and Trade Stuart Ayres said a Memorandum of Understanding signed this week between the NSW Government and the United Arab Emirates Food and Beverage Manufacturers Group (UAE FBMG) provides NSW businesses with a strategic  advantage in the supply of ingredients, new innovations and agritech solutions as UAE takes steps to progress its food security agenda.

The Russia Ukraine conflict will have large ramifications for global and Australian grains and oilseeds markets, and particularly wheat, according to agribusiness banking specialist Rabobank. The loss of access to all Black Sea wheat exports has not occurred in more than 100 years.

Petrol prices across Narrandera jumped to a new high last week, with local service stations charging almost $1.80 for a litre of Unleaded 91. The average unleaded petrol price in Narrandera was $1.77.4 per litre. The town’s motorists could be forgiven for pointing the finger at nations throughout the world which are flexing their military might.