Severe rainfall seen affecting Australian wheat quality
Australia’s eastern coast is expected to witness more-than-average rains in the next 15-20 days, with parts of New South Wales experiencing higher-than-expected rainfall over Oct. 10-16, a trend which could force quality downgrade of wheat crops in the region, market sources said.
The triple-dip La Nina continues to bring heavy showers in Australia, with the Australian Bureau of Meteorology on Oct. 6 issuing severe weather warning signals, including flash flooding, for parts of New South Wales.
New South Wales is the second-largest wheat producer in Australia, and farmers in the state will be harvesting a bumper crop in the 2022-23 marketing season (October-September), estimated at 10.2 million mt, according to data from the country’s agriculture department.
Wet weather forecast for Western Australia and Queensland is also expected to pressure the protein content of the wheat, market sources said.
** Chances of above-median rainfall in wheat-growing regions of New South Wales and Queensland remain higher over the next two weeks to Oct. 23, according to the Australian Bureau of Meteorology.
** Farmers in Western Australia, the country’s largest wheat-producing state, could start harvesting in late October or early November, but wet weather could raise concerns around crop quality, market sources said.
** Platts assessed Australian Premium White wheat at $371/mt Oct. 5, up 4.8% on the month, according to data from S&P Global Commodity Insights.
** Given expected lower yields due to hot and dry conditions seen in key wheat regions, total EU cereal production has been slashed by 8% on the year, to 270.9 million mt, according to the European Commission.
** France and Germany, the top two wheat producers in Europe, both are expected to receive below-than-normal precipitation through Oct. 19, according to weather analysts.
** Platts assessed EU wheat with 11% protein content CPT Rouen at $351.50/mt Oct. 5, up 7.2% month on month, S&P Global data showed.
** Weather outlook for the rest of October remains unfavorable with more than above-average temperatures expected to continue in the northern Plains and upper Midwest, both key grain-producing regions.
** Poor water level conditions in rivers and inland waterways have led to surging barge freights rates, further aggravating an already slow start to US grain exports for the 2022-23 marketing year (September-August), according to market sources.
** By Oct. 2, 75% of US corn acreage was matured, 11 points behind the last year but equal to the five-year average, according to the US Department of Agriculture.
** Platts assessed US Corn CIF New Orleans at $337.4/mt Oct. 5, almost 8% up on the month, reflecting a multi-week high since July 11, 2022, according to S&P Global data.
** A total of 20% of corn acreage was harvested in the week ended Oct. 2, 7% points behind the last year and 2% points behind the five-year average harvest pace.
** Soybean harvest across the US was 22% complete by Oct. 2, 9 points below the last year and 3 points behind the five-year average, according to the USDA.
Brazil and Argentina
** Planting of first-crop corn in Center-South Brazil reached 34.1% as of Sept. 29, up from 32.6% in the same period last year, private consultancy firm AgRural said in a note.
** Cloudy weather and low temperatures in the south have slowed crop development but concerns around declining crop yield have not emerged so far, AgRural said, adding that “[t]he pressure of pests, however, is a worry in some areas.”
** Weather conditions in Brazil have been largely favorable for planting this season, and this is expected to continue for the next few days through Oct. 14.
** The latest weather forecast sees rainfall ranging 20-50 mm in most of the southern region of Brazil over Oct. 3-10, Brazil’s National Institute of Meteorology INMET said.
** In Argentina, rains are seen in north Entre Rios, Santa Fe, Cordoba, La Pampa, west Buenos Aires through the week of Oct. 8, according to space technology provider Maxar.
** Wheat crop is already hit severely by the dryness in Argentina, while the early corn planting is significantly delayed due to the drought, sources said.
** Platts assessed corn FOB from Santos, a major Brazilian port, for November loading at $296.83/mt on Oct. 5, according to S&P Global data.