GAIN Report - AS6069 Page 3 of 3
Required Report - public distribution
Date: 11/3/2006
GAIN Report Number: AS6069
AS6069
Australia
Agricultural Situation
Ag DownUnder Vol. 16
2006
Approved by:
Kathleen Wainio, Agricultural Counselor
U.S. Embassy
Prepared by:
Mike Darby, Agricultural Specialist; Lindy Crothers, Agricultural Marketing Assistant; Meredith Elliott, Agricultural Assistant
Report Highlights:
· Australia Considers Importing Grain
· ABARE Crop and Livestock Report, October 2006
· Drought Causes Abandonment of Winter Cereal Crops; Potential Impact on Summer Crops
· Further Drought Assistance Brings New Allocations to A$910 Million
· Frosts Affect Fruit Production in Goulburn, Tasmania
· IRA Process Improvements
Includes PSD Changes: No
Includes Trade Matrix: No
Unscheduled Report
Canberra [AS1]
[AS]
Australia Considers Importing Grain
A forecast that the 2006-07 national wheat crop will be less than half last season’s, and the smallest in more than a decade, has prompted Australian Minister for Agriculture, Fisheries and Forestry, Peter McGauran, to announce on October 27 that the Government is currently considering potential sources of imported grain. Minister McGauran said the Government is assessing almost 40 applications from commercial operators to import corn, sorghum and wheat to identify potential stock feed supplies for farmers facing shortages due to the prolonged drought. The applications relate to bulk grain for stock feed from various countries, including the United States, United Kingdom, Argentina, Brazil, South Africa, China, Ukraine and Canada. “Applications to import bulk grain from the United States and the United Kingdom, countries from where we have previously allowed such imports, are being given priority and will be completed by the end of November,” said Minister McGauran. (For further information see GAIN Report 6068)
ABARE Crop and Livestock Report, October 2006
The following is taken from the Australian Bureau of Agriculture and Resource Economics (ABARE) October 2006 Crop Report: Most of Australia’s winter grain growing regions are in the grip of serious drought. Production of the major winter crops in 2006/07 will be substantially lower and cattle and sheep slaughterings higher than were forecast in ABARE’s previous crop reports. Output of the three major winter grains, wheat, barley and canola, is now forecast to be down by over 60 percent from last year and over a million tons less than during the 2002/03 drought. Taking into account the downward revision in crop and livestock earnings, the gross value of farm production of these commodities in 2006/07 is forecast to be down by 35 percent or $A6.2 billion below the previous year level.
ABARE’s latest projections place the wheat crop at 9.5 MMT in 2006/7, down 15.5 MMT from last season. The barley crop is forecast to be down 64 percent to 3.6 MMT and canola down 69 percent to 440,000 MT. Production in New South Wales is projected to decline the most. (For further information see GAIN Report 6068)
Drought Causes Abandonment of Winter Cereal Crops; Potential Impact on Summer Crops
As Australia is now firmly in the grip of widespread drought, production and exports of winter cereal grains (wheat and barley) for 2006/07 have been sharply reduced. The forecast for 2007/08 early season summer crop (sorghum and rice), which would typically be planted from now through to November, has also been trimmed significantly. Post forecasts assume average weather conditions from November onward. Under this scenario, late season summer crops (sorghum), would likely suffer the least effect from drought conditions.
The 2006/07 Australian winter cereal harvest has yet to begin in earnest. Drought conditions have caused significant abandonment, with many crops either cut for hay or grazed by sheep. Planting for the 2007/08 dry land summer crop (sorghum) has yet to begin in earnest and will likely require a significant rainfall event to do so. Irrigated summer crops (sorghum and rice) will likely be sown on time. (For further information see GAIN AS6066)
Further Drought Assistance Brings New Allocations to A$910 Million
On October 24, the Australian government announced additional drought assistance worth A$560 million to help struggling farmers through the worst drought on record. The new measures would potentially allow thousands more farmers across the country to access assistance, and followed the A$350 million extension to drought aid announced by the Prime Minister the previous week and the A$1.2 billion already provided over the past five years. (For further information see GAIN Report 6068)
Frosts Affect Fruit Production in Goulburn, Tasmania
Crop damage resulting from late September frost in Australia’s premier fruit growing district Goulburn Valley is yet unknown, but current estimates indicate losses of up to $A80 million. The area accounts for 80-85 percent of Australia's pears, 35 percent of its stone fruit (74% of Australia’s apricot harvest) and 25 percent of the nation's apples. Federal assistance has been made available for affected farmers. In Tasmania, October 16 frost has adversely affected fruit production in that state; apple, cherry and stone fruit yields are threatened. The extent of the damage is unknown, but press reports predict Tasmania’s $A120 million fruit industry could be halved. (For further information see GAIN Report AS6065)
IRA Process Improvements
The Australian Government has announced improvements to the Import Risk Analysis process. The new process, scheduled to take effect in early 2007, will include improved consultation, fewer steps, greater scope for scientific scrutiny and timeframes that are imposed through legislation. (For further information see GAIN Report AS6067)
Recent Reports from FAS/Canberra
The reports listed below can all be downloaded from the FAS website at: http://www.fas.usda.gov/scriptsw/AttacheRep/default.asp.
Report Number / Title of Report / Date6045 / Citrus Update / 07/17/06
6046 / Ag DownUnder Vol. 11 / 07/21/06
6047 / Grain Quarterly Update / 08/01/06
6048 / Food & Agriculture Import Regulations & Standards / 08/03/06
6051 / Australia Launches Strategy to Gain Access to Southern Indian Food Market / 08/10/06
6052 / Ag DownUnder Vol. 12 / 08/25/06
6053 / Cotton Quarterly Update / 08/31/06
6054 / Drought Update / 09/05/06
6056 / Ag DownUnder Vol. 13 / 09/08/06
6057 / Livestock Annual / 09/13/06
6058 / Ag DownUnder Vol. 14 / 09/26/06
6059 / Export Certificate Report / 09/27/06
6060 / Exporter Guide / 09/29/2006
6061 / Sugar Semi-Annual / 09/29/2006
6062 / Corish Report: Australian Government Response / 10/04/2006
6063 / Ag DownUnder Vol. 15 / 10/12/2006
6064 / A$350m Additional Drought Aid / 10/17/2006
6065 / Frost Affects Fruit Production in Goulburn Valley, Victoria and Tasmania / 10/18/2006
6066 / Grain Quarterly Update / 10/20/2006
6067 / Government Announces Changes to Import Risk Analysis Process / 10/31/2006
6068 / Australia Considers Grain Imports; Additional Drought Aid Announced / 10/31/2006
UNCLASSIFIED USDA Foreign Agricultural Service