Australia’s winter crop production is currently forecast to yield 25 million tonnes, well ahead of last year’s 17 million tonne harvest.

Australian Crop Forecasters managing director Ron Storey said while grain production was suffering in New South Wales and Victoria, South Australia’s wheat and barley yields would be higher than last year.

“Luckily we are not facing a repeat of last year’s very low national production levels, but farmers buying in feed grain will have to deal with higher prices,” Mr Storey said.

“There will be a price correction, but the question of when will be driven by the remaining October weather, and in the longer term, by the size of the northern hemisphere grain crop in 2008,” he said.

Mr Storey added world grain prices were at record levels due to low world wheat stocks, and domestic feed grain prices over the next three to four months would be driven by four factors.

These included: the chance of significant rain in the Australian grain belt during the remainder of October; a projected increase in wheat planting in the EU and US of which the impact on global supplies would be known by April to May 2008; the exchange rate; and potential imports of feed grain.

Good rain for the remainder of October would secure the wheat and barley crops at current levels and pave the way for a large sorghum crop in northern NSW and Queensland, which would boost feed grain supplies between February and April 2008.

Mr Storey said applications to import feed grain were being lodged with the Australian Quarantine and Inspection Service, but it could take two to three months before grain landed in Australia at sites without pre-existing approval.

Dairy Australia strategic analysis manager Joanne Bills said there was uncertainty over grain prices in the dairy industry and she urged farmers to get factual information before buying grain and fodder.

“It’s important people ring around to compare prices, get as much information and support as possible and not react to rumour and speculation,” Ms Bills said.

Weekly regional grain and hay prices were available at the Season Set Up section of the Dairy Australia website or by calling the Dairy Australia Memberline on 1800 004 377.

Ms Bills said dairy farmers were in a reasonable position given current milk prices.

“The milk price to feed grain ratio this season is still better than it was in 2002/203, because of improved farmgate returns for milk. The challenge for some farmers is that a lot more feed will be needed this year,” she said.

“Farmers will be doing feed budgets and assessing what they can afford to pay for grain and hay, given the milk price they have in front of them for the rest of the season.”

ENDS

For further information call Sid Pickering on 03 9694 3894, or 0418 175 611, or email This email address is being protected from spam bots, you need Javascript enabled to view it