Market Morsel: A big harvest doesn’t daunt Australia

Market Morsel

One of the questions that I keep getting from overseas subscribers is whether Australia is up to the export task that we face next year.

Provided nothing goes wrong between now and harvest, we will have a large volume of crops to leave our shores. How will we cope?

Well, this ain’t our first rodeo.

Australia has had big crops before (2016/17), and we will hopefully have big crops again. It is quite rare to have such huge crops two years in a row. Let’s look at the export program.

The first chart below shows the seasonality of wheat exports, with 2021 and also 2017 overlaid. As we can see, these are both two years with large export programs.

Since the start of the export season (December), we have so far exported 21.7mmt, and in the 2017 season, we exported 22.2mmt. We easily have the capacity to export the volumes that are required of a large export program

The second chart shows the cumulative exports for 2017 and 2019. The USDA export forecast is included in the dotted line. There are still a number of months to go, allowing us to easily reach record export levels.

As we move into next year, with stock levels that are lower than average, we will easily be up to the task. We will see huge export programs of wheat in the first half of 2022, as we aim to cement the premiums in the market ahead of the next northern hemisphere harvest.