They say where there’s mud there’s money, and given recent high rainfall in much of Australia excepting perhaps North Queensland, it looks as though dust and empty dams have given way to abundant growth and in some places to mud because sometimes we get a little more rain than we bargained for.
No picture reflects a wet winter better than that of a bogged boom spray in a wheat field. Such situations are never an easy fix (nor cheap and sometimes the rescue equipment can get bogged as well) but such an image must bring a smirk to the face of a crop-duster as he/she flies urea onto yellowing crops and rules the skies once again.
Upgraded Weather Forecasting Services
So what are the weather gurus saying, we know El Niño is gone for the time being but we are now under the influence of her sister, La Niña. The Bureau of Meteorology’s Water and the Land website provides an integrated suite of weather and climate information and seems like a good starting place to check out what to expect going forward and there have been some recent upgrades.
The website offers a range of services from weekly rainfall and wind forecasts, to frost potential for a couple of nights and mornings, radar and satellite as well as climate change and trend maps.
Clicking on the El Niño and La Niña tab, then SOI , details a rapidly rising Southern Oscillation Index (SOI) index of 5.8 for June, increasing the probability of a La Niña event with above average rainfall ,but remember La Niña events typically occur with sustained SOI values above 7 so we are still in a neutral phase.
The flip side to increased rainfall is an increase in weed and disease pressure but at least it means a crop or decent pasture for those in the dryland areas and hopefully a lessened risk for a bad bushfire season given the generally cooler conditions (always exceptions with such a large landmass and varied climate).
For those relying on contract harvesters/sprayers etc. it may be prudent to make all bookings well in advance to ensure timeliness of operations.
So what of Prices
Who would have thought back in 01/97 with an Eastern young cattle indicator (EYCI) price of 1.52 c/kg cwt that projecting forward to 04/07 would see a record price of 6.60 c/kg cwt, (see mla.com.au).
Record prices for young cattle is great news for the vendors, but the flipside is pretty tight margins for the feedlots and finishers, eased only by access to cheaper feed prices helping to improve grain-fed beef margins.
Be careful in gross margin analysis at these levels as cheaper beef import options into key markets from places such as South America, as well as alternatives such as buffalo into Indonesia and switching to white meats may see a softening in demand and subsequent pricing going forward.
We know feed grains are cheap, and milling wheat prices are down as well, I guess growers are hoping for a dry break at harvest and improved yields this year to offset the lower prices. The best tactic here is to always maintain good supply arrangements with key and long standing traders, marketers etc. as chopping and changing around in a quest for the highest price will often lead to a lower average price in the long term.
Yes milk fat prices are equal to, if not below production costs at present, but similar to the grain situation, timely rainfall and abundant growth should at least lessen feed costs and associated demand for electricity for irrigation etc. and hopefully allow for some cheer at Christmas.
To wrap up, prices are never up across the board for all those involved in agriculture and horticulture simultaneously, but we can all enjoy and recognize the benefits to the environment of a wetter year ahead, with improved stream flows and increasing water storages both natural and man-made, with the flow on positive effects to the flora and fauna of this great country, as the pendulum swings from dry to wet, from sparse to abundant, as El Niño disappears into memory for a year or two.