Black Sea wheat threat highlighted
While touring WA’s grain-growing region, a global expert has warned growers that managing costs are key to staying competitive with Black Sea wheat.
During his visit to Broomehill on March 8, Rabobank global grains strategist Stefan Vogel said there was some good news in the outlook for wheat prices, with a reduction in global stocks outside China and a dry winter across US wheat-growing areas elevating wheat prices on US exchanges.
However, he said with the Black Sea region’s wheat crop, currently in dormancy, expected to be in good shape, it would be Black Sea, and primarily Russian, exports into South-East Asia, Australia’s primary wheat export market, that would determine the price prospects for WA growers.
And in order to ensure they remained competitive with the low-cost Black Sea region producers, WA grain growers would need to keep a close eye on their own cost structures while at the same time maintaining the high-quality grain for which Australia was renowned, he said.
London-based Mr Vogel, who is on a two-and-half-week tour of Australia for a series of presentations to grower groups and at the 2018 Wagin Woolorama, said his job was to educate growers on the supply and demand of grains around the world, but especially in the key importing and exporting countries.
“We had a very good discussion in Broomehill — I think the group was overall very appreciative,” he said.
“There were a lot of interesting questions raised around the current political situation in the US but at the end of the day, the Russian crop will tell us where prices need to be.
“It might not matter how long there is dryness in the US — it will be a matter of what your export competition is doing and that will come out of the region of Russia”
Mr Vogel also touched on African and South-East Asian import growth as key and a continued focus for Russian wheat exports.
Mr Vogel, who is touring Australia as part of Rabobank’s Visiting Experts program, spoke to grain growers and industry representatives at a series of presentations across WA, including to grower groups Liebe Group and Stirlings to Coast.
Get the latest news from thewest.com.au in your inbox.
Sign up for our emails