Growth in Grains demand leading to opportunity and competition
4 March 2014
Strong growth in global consumption - particularly across Asia - is expected over the medium term, according to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
ABARES Commodities Analyst Neil Thompson told delegates at the annual Outlook Conference that consumption growth reflected higher demand for coarse grains and oilseeds for use as livestock feed and cooking oil.
“The increase in global demand for grains and oilseeds is expected to keep world prices relatively high, prompting growers to increase production,” Mr Thompson said.
The largest increases in production over the next five years are expected to be concentrated in South America, particularly Brazil, and the Black Sea region.
“Rising international grain production and exports will result in greater competition for Australian grains and oilseeds exports destined for Asia,” Mr Thompson said.
“ABARES projects that exports of grains and oilseeds from the Black Sea region alone will increase to almost 80 million tonnes by 2018-19, which is 20 per cent higher than 2013-14.”
Australian production of grains and oilseeds is expected to increase only modestly over the medium term.
“With increasing competition, Australian producers will need to focus on productivity growth to maintain and improve farm gate returns,” Mr Thompson said.
Finding new and innovative ways to improve production demands a continuing emphasis on research efforts across the Australian grains industry, according to Mr Thompson.
With a focus on opportunities for Australian agriculture, ABARES Outlook 2014 is being held in Canberra on Tuesday 4 and Wednesday 5 March, 2014.