Cropping land was amongst the strongest performing segment of the rural property market in 2022 with significant increases in prices amid a period of tight supply. South Australia was a standout market in 2022 with the median price rising by 46.9 pc.
“Favourable financial returns are a big motivator to continue with agribusiness pursuits. Land prices continued to break local and district records across most areas of SA”, explained Phil Keen, State Real Estate Manager, South Australia. Read the latest update.
The Bureau of Meteorology (BOM) is predicting a reasonable level of rainfall in most states during April except for South Australia and parts of the Wimmera Mallee in Victoria. There is a 60 per cent (pc) chance of exceeding median rainfall in parts of Queensland and around 50 pc chance of exceeding median rainfall in parts of New South Wales and Western Australia. Crucially, sub soil moisture is very high in most major cropping regions, it may not take a lot of rain to top up.
From the field
Mallee
“El Nino is the buzz word of the month, with conversations regarding rainfall predictions a daily occurrence and a great concern. It has been a dry start to the season for most of the Mallee, with as little as 20 mm of summer rain since November. Showers early last week offered a little reprieve, with patchy rainfall totalling anywhere from 10-40 mm.
“After a dry summer the top 15-20 cm of the soil profile has now dried out, however on the back of a record rainfall year there is still plenty of residual moisture at depth. Recent data released by Agriculture Victoria’s soil moisture monitoring network, shows that root zone soil moisture (from 30 cm to 1 m) in parts of the Mallee is at saturation. The downside is that the most recent rainfall outlook released by the Bureau of Meteorology predicts a drier than average April-June period for the region. However, if we can get a solid Autumn break, we should have enough moisture for the dry topsoil to connect with the saturated subsoil. Allowing crops to tap into enough moisture to carry them through to the end of the season.
“Looking back at the months leading up to seeding, the sprayers finally came to a halt for the first time in almost six months. This was due to a lack of rainfall during the February-March period, with paddocks remaining quite clean following their post-harvest weed control. This has given growers the opportunity to complete other tasks, with repairing rough paddocks being the first cab off the rank, following such a wet season. A variety of implements have been used to repair the deep wheel ruts and large bog holes including speed tillers, discs, wheel track renovators to name a few, with growers achieving impressive results. Additionally, there has been a lot of seeding preparation including seed grading and treating, acquiring seed and fertiliser, gypsum applications, machinery maintenance and more.
“Some Mallee growers have made a start to their cropping programs with grazing crops such as vetch, oats and medic being sown to fill a Winter feed gap, as well as legumes for brown manure. In a fortnights time seeding will hit full steam with vetch hay, oaten hay and canola being sown early to mid-April, followed by lentils and barley around ANZAC day. Wheat programs will commence in early May, followed by field peas anytime up until the beginning of June.
“Ideally, we would like to get a solid Autumn break to be seeding into moisture to establish crops on time and get a knockdown on any early weed pressure. Some areas were fortunate enough to get rainfall totals around an inch during last week’s rain, which will hold them in good stead. Whilst other areas are still eagerly waiting, with a constant eye on the weather forecast.
“Across the river, rice crops will soon be getting harvested, with most paddocks being drained off in the last fortnight. Crop maturity is later than usual due to the difficulties faced at sowing with the relentless wet weather, and the cold snap we had in early January. Yields are still looking promising considering the challenges faced this season, with some great looking crops about the district.”
Pat Conlan, Elders Agronomist, Swan Hill, Victoria.
“As the weather begins to cool, we have seen defoliation start to occur in the cotton crops. Yields will be variable this year as there have been a mix of growing conditions and several challenges including early establishment with a colder than average start and some crops struggling with waterlogging early on. Crops that were planted late in particular have been unable to recover fully to reach their normal yield potentials.
“Disease will be top of mind as people start to move into their winter crop sowing. Last year was incredibly wet and caused several disease issues. This will be seen with high inoculum loads in paddocks and potentially planting seed that is carrying disease. Good quality planting seed and premium seed treatments will be in high demand to minimise the carry over risk.
“The dry weather over the summer months was causing high stress and concerns for farmers along with the BOM declaring an El Nino weather pattern event. There have been decent falls in the last month in a number of the key NSW growing areas that have eased concerns somewhat and given farmers confidence to begin their winter crop programs.”
Sally Broadhead, Elders Technical Services Manager, New South Wales.
“March in Western Australia finished with some widespread rain which quickly kicked into gear the 2023 season. With a good profile of moisture, a sowing window for canola opened up. For many it was too early as they were unprepared with paddocks, machinery, fertiliser and seed not in position to start. This has caused immense pressure to get everything together to try and capture this moisture before it disappears.
“With early rain it creates both opportunity and frustration. There are many paddocks that have a high stubble loading from last year’s crop. The added moisture creates challenges in managing stubble loads prior to sowing. A good germination in many paddocks is the chance to have a knockdown before sowing.
“There is a lot of positivity amongst growers in WA, there is always some level of nerves as we move through the month to ensure the crop is sown into ideal conditions for a good establishment.”
Bill Moore, Elders Technical Services Manager, Western Australia.
“We have areas of weed germination across the state and some forecast rainfall this weekend which will add to soil moisture levels ahead of sowing.
“The first three months of the year have recorded a decile 3 across the state in terms of rainfall, which would indicate rainfall is needed before the traditional start to sowing later this month.
“The focus has been on getting fertiliser on-farm ready to sow, there have been some dispatch issues to work through.
“Alestar malting barley will have two grower segregation sites this season which will assist growers who are considering the variety. Those sites will be at Apamurra near Murray Bridge and Ardrossan on the Yorke Peninsula.”
Lyndon May, Elders Technical Services Manager, South Australia.
Northern hemisphere spring is nearly here
Nathan Cattle from Clear Grain Exchange shares his thoughts on the current grain market and what’s been happening on the exchange.
Russia continues to have a large influence over the direction of international grain markets as we head into the northern hemisphere spring with large questions remaining over this year’s crops.
Other than Australia, Russia has the major surplus of grain the world needs right now and is using its position to try and weigh in on markets. Earlier in March the Russians eventually extended the Ukraine grain corridor deal, but not before trying to leverage their position.
At the end of March, the Russians started talking about nationalising grain exports to prop their prices up, which would ultimately support global prices.
The Russian inuendo happens as the northern hemisphere enters the critical spring period for crop production. Winter wheat crops come out of dormancy under snow and grow to maturity, while spring crops including high protein spring wheat, corn, soybeans, canola, barley, oats and pulses are still to be planted.
At this stage the USDA is still expecting global wheat and corn stocks to tighten year-on-year, yet there has been a lot of potential extra supply already priced into markets. Hence northern hemisphere weather over the next few months could have a big influence on price movements.
Australian buyers have been battling to get their bids up to the prices that growers had been offering grain for sale in early March. However last week saw buyers increase their prices across multiple grades and many growers sold at prices they were seeking.
APW1 wheat and lower grades continue to trade in volume across the country. The price difference between APW1 and the lower grades has closed up with AGP1 trading at $372/t and APW1 trading at $385/t Melbourne as an example at the time of writing.
Higher protein milling grades are beginning to trade more sporadically as millers become more covered on required grades however strong premiums are still being achieved when it’s trading.
Demand for feed barley has remained relatively consistent with good volumes trading while malt grades are now trading more infrequently and again at good premiums when they do.
Some price discovery emerged in canola with some trading at $672/t + oil payments in Geelong and GM canola trading $700/t + oil payments in Kwinana recently.
Oats are now trading $375/t in Kwinana and the pulse market has heated up with beans trading at $404/t Pt Adelaide, nipper lentils at $853/t Pt Giles and $846/t Adelaide, and lupins at $345/t Kwinana.
Regardless of what grain you have in warehouse or whether you want to sell in the near-term or are prepared to target higher prices and potentially hold grain for longer; get it on offer so all buyers can see it and try to buy it.
That's how you create demand for your grain!
Growers that like prices now but want to defer delivery and payment into future months such as July, are actively offering grain for sale in the July month on Clear Grain Exchange (CGX).
On top of this, there remains evidence of physical grain trading internationally at better values than those bid to Australian growers on an equivalent basis.
Australian grain remains in demand, growers can assess what they have and ask for a price from the market they deem is fair value for their grades, and there are options available for growers to manage their cashflow and risk.
Create demand for your grain and offer it for sale at the price you want, whilst being protected by anonymity and secure settlement.
Market indicators
"I sell wheat and barley through CGX and usually achieve above the market value as advertised in the current market."
- Jeff Burgess, grain grower, Gulnare, South Australia.
Learn more about Jeff's experience with Clear Grain Exchange.
The information contained in this article is given for the purpose of providing general information only, and while Elders has exercised reasonable care, skill and diligence in its preparation, many factors (including environmental and seasonal) can impact its accuracy and currency. Accordingly, the information should not be relied upon under any circumstances and Elders assumes no liability for any loss consequently suffered. If you would like to speak to someone for tailored advice relating to any of the matters referred to in this article, please contact Elders.