Forecast for a reduced harvest
LOWER cattle and horticultural prices have helped push the NAB Rural Commodities Index down 2.2 per cent in September, despite stronger domestic wheat prices.
The latest report includes another cut to NAB’s wheat production forecast, to 18.7 million tonnes. This would be the smallest harvest in a decade, and down almost 47 per cent on last year’s record crop.
NAB Agribusiness economist Phin Ziebell said weather had been a major driver of local prices and production levels.
“The weather has been wildly varied this year,” Mr Ziebell said.
“One of the biggest drops in wheat production will come from New South Wales, which has suffered from very low rainfall, frosts and heatwaves in the space of a single season.
“Meanwhile Western Australia and, more recently, south-east Queensland, have seen soaking rains.
“There’s already been a partial recovery in cattle prices because of the rain in Queensland, but much of the country remains very dry and pasture availability ahead of summer is by no means guaranteed, so slaughter levels are expected to remain elevated.”