Agribusiness News Recap

By: "Farm Tender" News
Hay & Fodder News
Apr 04, 2019
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By Georgia Devenish - Agricultural Research Analyst at JLL.

Horticulture.

The 2018/19 farm gate value of the Queensland strawberry industry is forecast to be $148 million. This figure is 8 percent down on the final estimate of $160 million for 2017/18 and 14 percent lower than the the five year average. Despite this, the industry is starting to show signs of recovery after taking a $12 million hit due to last year's contamination scandal.

Mundubbera based citrus grower, Ironbark Citrus, Atherton Tableland banana grower and banana flour producer, Natural Evolution, and the Gulf of Carpentaria's Australian Gulf Seafoods are three of the eight recipients of the second round of grants through the Growing Queensland's Food Exports pilot Program. The $1.3 million allocated to the program focuses on supporting the state's food businesses to build their export capabilities.

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Livestock

A Memorandum of Understanding has been signed by Northern Pastoral Management (NPM) and the MG Corporation which will see parcels of the Miriuwung Gajerrong land opened up to cattle production and irrigation. The project will cover the Miriuwung Gajerrong native title claim area in the east Kimberley of Western Australia bordering the Northern Territory. NPM was established by Jack and Vicki Burton, the owners of Yeeda Pastoral Company which operates across 1.2 million hectares of land in the Kimberleys.

The multi-million dollar refurbishment of Central Agri Group's Batchelor meatworks in the Northern Territory - which was mothballed in 2003 - is nearing completion. The project, announced last year, comes just months after the Australian Agricultural Company's abattoir near Darwin was closed in July 2018. When running at full capacity the Batchelor meatworks is expected to process approximately 200 head of cattle per day.

The Eastern Young Cattle Indicator has jumped above 500 cents per kilogram only a fortnight after falling to a four-year low of 385 cents per kilogram. The rise comes as a result of significant rainfall in parts of southwest Queensland and in patchy areas in New South Wales and Victoria over the past few weeks.

Cropping

China has banned canola imports from major Canadian exporters Richardson International and Viterra reportedly as a result of the ongoing trade and diplomatic tensions between the two countries. Chinese customers have cited pests being detected on the shipments as the reason but speculation remains that the action may spread to all Canadian canola exporters. The ban could have the potential to inflict serious damage on Canada's canola producers given the Chinese market accounts for 40 percent of the nation's canola exports annually.

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The first complete set of supply and demand numbers for the 2019/20 season has been released by the International Grains Council (IGC). The IGC projects a 50 million tonne rebound in total grain production for 2019/20. Projected gains include an increase of 24 million tonne in wheat production while maize production is expected to increase by 10 million tonnes and barley by 7 million tonnes. Smaller opening stocks, however, will mean overall supply is expected to only marginally change year-on-year. Trade is projected to edge upward and consumption is forecast at a record level.

According to the United States Department of Agriculture prospective plantings and grain stocks report released last week, China's demand for oilseeds will continue to climb just as the US looks set to sow less soyabeans in the coming season. Demand for alternative animal proteins has been cited as driving the increased demand.

The Port of Wyndham in Western Australia's far north, is set to ship a record four cargoes of maize to Korea this year. The upswing in production in the Ord River region has driven this expansion in volume the likes of which is usually expected out of Victoria. Victoria is only expected to load one 2019 cargo.

Area planted to mungbeans in eastern Australia is down approximately 50 percent and harvest tonnage is predicted to be the lowest in two decades. The Australian Mungbean Association estimates around 50,000 hectares were planted this season but only 40,000 hectares will be harvested.

Rice harvest is underway and expected to be less than a tenth of last year's crop. The estimated 50,000 tonnes harvest will be the second lowest since the 1930s. Worth an average of $500 per tonne, this decline in rice production translates to more than $300 million.

Dairy

Fonterra Australia has recorded a 28 percent drop in its February milk intake compared to the same month last year. The total intake for the first eight months of the season was 17 percent lower than last year.

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Agribusiness

Listed livestock exporter, Wellard, is expecting to wrap up the sale of its Wongan Hills feed mill and its Beaufort River Meats abattoir in Western Australia this month. Ausvision Rural Services, a subsidiary of Wellard's live export rival, the Jordanian-owned, Livestock Shipping Services will acquire Beaufort River Meats as well as the Baldivis pre-export quarantine site lease which was also included in the sell-off process. The abattoir sale is reported to be worth circa $8 million.

Ceres Agricultural Company appointed administrators late last week. The agribusiness company is backed by listed Singapore fund manager Duxton Asset Management and majority-owned by Garrick Hawkins. The appointment comes less than a week after the sale of the "Brudle Park Aggregation" was reported for circa $50 million.

Water

While cyclone Trevor brought some relished rain to New South Wales and tributary flows into the Macquarie and Namoi rivers, there was relatively low inflows into storages.

The Federal Government has announced the funding of a CSIRO study into irrigation in the Roper River catchment of the Northern Territory. The $3.5 million will be used to conduct a comprehensive assessment of the development potential of the water and soil resources of the Roper River Catchment.

Total storage in the Murray Darling Basin has dropped below 30 percent for the first time in three years. No general security allocation is expected in the Murrumbidgee or Murray in southern New South Wales in the 2019/20 water year.

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Weather

Australia has recorded the hottest March on record. The Bureau of Meteorology has also announced it was the hottest start to the year on record, with the first quarter being at around 2.2 degrees above the long term average. This is nearly a degree hotter than the previous hottest first quarter according to senior climatologist, Blair Trewin.

Trade

High rates of cattle slaughter during March resulted in a sharp rise in Australia's beef exports for the month. The Department of Agriculture released export statistics this week which highlight a 7.4 percent rise in beef exports to 102,429 tonnes; the highest monthly total since August 2018. Majority of customers recorded a rise in volume but China most notably surpassed the milestone of 20,000 tonnes of Australian beef in a single month. Year to date, there has been a 67 percent rise in beef exports to China compared to the same three-month period last year.

Australian almonds growers can now export their produce to Chile following agreement of new market access arrangements. Australian agricultural exports to Chile are worth approximately $4 million annually.