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 Rain costs crop $700m 

Rain costs crop $700m

16 Feb, 2011 06:04 AM
THE drenching eastern Australia has received in the past two months has slashed about $700 million from the grain harvest.

The Australian Bureau of Agricultural and Resource Economics and Sciences says the losses - caused by crops being wiped out or downgraded from human quality to stock feed - come on top of a $1 billion write-down in the value of the wheat harvest it assessed in December, after severe rain and floods damaged crops in November and the first half of December.

But despite the savage impact of Mother Nature on some grain growers this harvest, the season has produced bumper crops and set many new harvest records, including a record national wheat crop (26.3 million tonnes), a record Victorian wheat crop (4.1 million tonnes), and a record Victorian canola crop (450,000 tonnes).

The results have left agricultural leaders wondering about how good the harvest could have been if not for the massive rainfall.

Paul Morris, deputy executive director of ABARES, said the unusual summer had produced a ''mixed picture'' for farmers growing grain and other winter crops. To examine the impact of rains and floods on farmers over the two months since the last forecasts were released, ABARES took the unusual step of conducting a telephone survey of 380 grain growers.

''Some have lost crops and been devastated. Others have got the best crop ever. It's really been quite an amazing story this year,'' he said.

''It's just amazing some of the yields they've been getting,'' he said.

The latest ABARES Australian Crop Report shows wheat growers in New South Wales and South Australia achieved record yields.

Production figures for NSW illustrate the extreme year. NSW farmers grew wheat on 5 per cent less land this season than last yet produced twice as much wheat this year - a record 10.6 million tonnes. This figure itself is 1.1 million tonnes lower than ABARES' previous forecast for NSW released in December.

Russell Amery, president of the grains group of the Victorian Farmers Federation, said many growers had experienced a frustrating harvest.

''Sadly, it's the year that for a lot of us looked like being the year to get us out of trouble. And as a result of the November and January rainfalls it's turned it into an ordinary year and even a loss year for some,'' he said.

''In my district we were two days off having one of the best harvests we've ever had, probably the best harvest. That's how close it was to putting the headers in the paddock, and it just all turned pear-shaped from there.''

Other key findings of the ABARES report include:

■ Total winter crop harvest for 2010-11 nationwide is estimated at 42.1 million tonnes, the biggest since 2003-04.

■ Victorian winter crop production is estimated at a record 7.9 million tonnes.

■ Heavy rain and floods over the past two months have slashed about $200 million from the value of the Victorian grain harvest.

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Date: Newest first | Oldest first
The floods cost over 2.5 million tonnes of production according to the ABARE report, this must equal at least $750 million alone.

In addition, we have seen in excess of 10 million tonnes of wheat alone down graded to feed.

This means to me that there was at least a billion dollars lost to the value of the wheat crop alone if you allow a quality price spread of only $100/t, but in many cases it was actually more.

The $700 million headline grossly underestimates the flood losses in eastern states and this report and its conclusions only rub salt into the wounds of the many farmers who are badly affected by the floods.

Posted by Pete Mailler, 16/02/2011 6:49:40 AM
There is a vast difference between "money lost" and money "not made". Because I am old and stupid, I don't count my income until it's banked...so when I get a downgrade, but a yield higher than last year, and a feed grain price higher than last years milling price, I don't moan and start yapping for a buscuit from the government. This seems to very much a case of lost opportunity, rather than lost income - with a few notable exceptions.
Posted by ME Again, 17/02/2011 8:05:07 AM
You may be old, but probably not stupid. However, when I have grown a crop and can see the yield and quality in the paddock it is valued in the balance sheet as work in progres. When the crop is downgraded in both yield and quality to the extent it was this year it is a real loss. I try not to spend my money until it is banked, but many producers were forced to spend a lot to support the yield potential of this crop. This year's prices are generally higher than last year and this is a great thing, but assessing the losses to crop value and yield by comparing it to last year is not a valid way of assessing the impact of this year's weather. Finally, I didn't ask for a biscuit from the government, I asked for fair reporting of the impact of the flood,
Posted by Pete Mailler, 19/02/2011 4:23:35 AM

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