by PressAustralia could become a major wheat exporter to Asia
Australia emerges as wheat producer leader
The global agricultural market is still in a precarious position after a surge in demand in 2020. There is a shortage of supply, which has been exacerbated by a reduction in the volume of crops in a number of countries. As a result, the leadership among wheat exporters has changed, and Australia will now be the main supplier of wheat for the Asian region in the 2021/2022 marketing year.
The season promises to be a good one for the country, as grain values hit record highs. Australia’s Premium White wheat index rose to $332 a ton FOB, a historic high.
According to data from the Bureau of Economics and Agriculture, the country’s grain production this season will total 32.6 million tons. Although lower than last year’s projection of 33.3 million tons, it is the second highest in the history of the local market. It is expected that 23 million tons of the expected harvest will be exported.
Australia’s emergence as a supplier leader in Asia is due to several factors. Unfavorable weather conditions in North and South America have significantly reduced production, resulting in lower exports. As for another major seller of wheat, Russia, the decline in supplies is due to government restrictions, from which local traders suffer losses. In both cases, Australia found itself in an advantageous position, especially since the country has had difficulty competing with other exporters for two years in a row.
During 2017-2019, the state experienced a severe drought that significantly reduced grain yields and quality. Therefore, analysts believed that Australia would not be able to quickly regain the position it had in the global market before the drought. During this time, Southeast Asian countries began to buy Black Sea wheat, which also cost less. It would seem that what could make countries return to the Australian grain, the price of which is 10-15 dollars per ton more than products from the Black Sea. However, events have developed in such a way that wheat has once again become popular with importers. Argentina produced little grain, while Russia imposed restrictions on exports, and buyers had no choice but to turn their attention to producers from Australia. This season, they will have to meet the demand for both high quality and low quality wheat. The fact is that the drought in North America has reduced the supply of spring varieties with high protein content, and the supply of Black Sea products of medium and low quality is limited.