Coarse grains

In 2024–25, the gross value of barley production is forecast to increase by 4% to $3.7 billion, while the gross value of sorghum production is forecast to fall by 2% to $912 million (Figure 1.1). Despite the mixed outlook, production values of coarse grains are forecast to be the third highest on record. The increases reflect elevated levels of domestic production, which are forecast to more than offset the fall in coarse grain prices.

Figure 1.1 Annual value of coarse grain production

The gross value of barley production forecast for 2024–25 is $153 million higher than expected in the June 2024 Agricultural Commodities Report. This largely reflects a slight upward revision to barley production volumes, owing to better-than-expected rainfall during July in Western Australia and an increase of planted area in New South Wales. The gross value of sorghum production is broadly in line with the June 2024 Agricultural Commodities Report, with a downward revision of $13 million due to lower prices.

The value of barley exports is forecast to decrease by 19% to $2.7 billion in 2024–25, reflecting lower expected export volumes and to a lesser extent a fall in export prices (Figure 1.2). Falling prices for Australian barley are attributed to declining international prices driven by increased global supply, particularly from the European Union. Since the removal of China's tariff on barley in August 2023, Australian barley export volumes to China have returned to near 2016–17 levels, shifting away from the Middle East and parts of Asia. Demand for Australian malting barley from China, along with export destinations established prior to August 2023 such as Mexico, is expected to support export prices in 2024–25.

China is the world's largest beer producer and relies on imported malting barley for brewing. Demand for Australian malting barley surged between May and June 2024, following the tariff removal of Australian barley in August 2023. This increase in exports coincided with major events such as the Qingdao International Beer Festival, Euro 2024, Copa America, and the Paris Olympics. Continued strength in demand for Australian malting barley exports to China in 2024–25 is expected to be constrained by weak economic conditions and competition from other alcoholic beverages such as spirits (see Economic Overview and Wine).

The value of sorghum exports is forecast to fall by 11% to $816 million in 2024–25, reflecting lower export volumes and falling export prices (Figure 1.2). The lower export volume reflects the impact of rains in April, causing a downgrade in the 2023–24 sorghum crop quality, diverting it to the lower value domestic market as pork and poultry feed. Despite this, export volumes are expected to be 61% above the 10-year average to 2023–24. China continues to remain the largest export destination for Australian sorghum, accounting for 89% of total export volumes in 2023–24. Falling prices for Australian sorghum reflects increased global supply of sorghum and other coarse grains.

Figure 1.2 Australian barley and sorghum export values by major export destination

Australian barley prices are forecast to fall slightly in 2024–25 driven by increased global production. An increase in global coarse grain supply, primarily driven by corn, is expected to place downward pressure on the prices of all coarse grains, including barley. Australia's coarse grains sector is largely export focused and causes domestic prices to closely mirror global prices. Prices are expected to remain subdued from softening demand from major global importers, as production is expected to outpace global consumption. The increase in global coarse grains supply in 2024–25 is expected to drive:

• The world indicator price for corn (fob Gulf, US) to decrease by 8% to an average of US$188 per tonne (Figure 1.3).
• The world indicator price for barley (fob Rouen, France) to decrease by 8% to an average of US$205 per tonne (Figure 1.3).
• The world indicator price for sorghum (fob Gulf, US) to decrease by 6% to an average of US$241 per tonne (Figure 1.3).
• The Australian feed barley price (Geelong feed) to fall by 6% to an average of $299 per tonne (Figure 1.4).
• The Australian malting barley price (Geelong malting) to fall by 6% to an average of $322 per tonne (Figure 1.4).
• The Australian sorghum price (Brisbane sorghum) to fall by 10% to an average of $382 per tonne (Figure 1.4).

A decline in global prices is expected to place downward pressure on domestic prices. Domestic prices are expected to be approximately 7% below the 10-year average to 2023–24 in real terms.

Figure 1.3 Average annual global coarse grain export prices 

Figure 1.4 Average annual Australian domestic export prices

Australian barley export prices are expected to fall alongside easing international export prices in 2024–25 but is expected to trade at a premium over international prices. Before 2023, Australian barley traded at a discount due to tariffs imposed by China. The lifting of these tariffs has since helped recover demand and prices, supporting domestic export values.

Australian barley production is forecast to increase by 13% to 12.2 million tonnes in 2024–25, approximately 7% above the 10-year average (Figure 1.5). The forecast increase in production is driven by improved seasonal conditions in Western Australia, a key barley producing state, and strong production in New South Wales and Queensland (see Seasonal Conditions). The overall size of the 2024–25 barley crop has been tempered somewhat by dry conditions in South Australia and Victoria, however, better-than-expected July rainfall in some regions has supported crop establishment and growth.

Area planted to barley is expected to increase by 6% to 4.4 million hectares in 2024–25. Overall, the expectation of improved growing conditions and strong demand are forecast to boost the area planted to barley. This increase reflects a favourable start to the season in Queensland and New South Wales, along with barley's resilience to drier conditions compared to other crops. Additionally, the longer planting window for barley has allowed for some late plantings in drier areas, leading to higher barley acreage and a reduction in area planted to crops like canola.

Grain sorghum production is forecast to increase by 9% to 2.4 million tonnes in 2024–25, 42% above the 10–year average to 2023–24 (Figure 1.5). The generally neutral rainfall outlook for spring coupled with above average levels of stored soil moisture in northern New South Wales and southern Queensland are expected to increase sorghum area planted. Area planted is forecast to increase by 5% to 622 million hectares in 2024–25 and remains 17% above the 10-year-average to 2023–24. However, area planted to sorghum will also depend on the timing of winter crop harvests and sufficient soil moisture during germination and early growth.

Australian coarse grain export volumes are expected to fall by 11% to 9.5 million tonnes in 2024–25 because of high global supply and softened demand. Australian barley export volumes are expected to fall by 14% to 7.2 million tonnes, and sorghum export volumes are expected to fall by 5% to 1.8 million tonnes (Figure 1.5). Overall, coarse grain exports are expected to decline due to low carry-over stocks from the previous year, which will reduce the exportable supply as high stock levels from previous years are depleted.

Figure 1.5 Annual coarse grains production and export volume

World coarse grain production is projected to reach a record 1.5 billion tonnes in 2024–25, surpassing the previous record level set in 2021–22 (Figure 1.6). Increased barley production in the European Union and Australia, and sorghum production in the United States, is expected to offset the decrease in barley production in the Russian Federation and corn production in the United States.

World barley production is expected to increase by 2% to 145 million tonnes in 2024–25. This is driven by increased expected yield in the European Union and Australia, which offset decreases in the Russian Federation, Canada, Ukraine and Argentina:

• Barley production in the European Union is expected to rebound by 8% in 2024–25, reaching 51.9 million tonnes despite mixed climate conditions. Production in Spain, Nordic countries, and Bulgaria is anticipated to reach record levels. Steady barley production is expected in Poland, Lithuania, Estonia, and Latvia. By contrast, Germany and France are expected to see decreases in barley production due to saturated soil and wet conditions.
• Barley production in the Russian Federation is expected to decrease by 11% to 18.3 million tonnes due to extreme heat. Decreased production is expected to cause lower exportable supply.
• Barley production in Canada is expected to decrease by 3% to 8.6 million tonnes, due to reduced planted area following dry conditions.
• Barley production in Ukraine is expected to decrease by 17% to 5.3 million tonnes, due to less area planted because of unfavourable weather conditions and lower expected profit margins resulting from high freight costs.

Figure 1.6 Global production of coarse grains and feed use of corn 

World corn production is expected to remain steady at 1.2 billion tonnes in 2024–25, with increased output in China and Brazil offsetting reduced production in the United States, the world’s largest corn producer. If realised, this would be the second-highest global corn production on record:

• Corn production in the United States is expected to decrease by 1% to 384 million tonnes but will remain at record high levels. Higher yield is expected to partially offset the decreased area planted. Closing stocks are projected to increase further in 2024–25, reflecting high domestic supply and low world prices.
• Corn production in China is expected to increase by 1% to 292 million tonnes owing to increased area harvested.
• Corn production in the European Union is forecast to decrease by 1.6% to 60.5 million tonnes reflecting decreased yields more than offsetting increased area planted.
• Corn production in South America is expected to rise; the volume of corn production in Brazil is expected to increase by 4% to 127 million tonnes from increased planted area and yields, while production in Argentina is expected to increase by 2% to 51 million tonnes owing to an increase in planted area.

Global consumption of coarse grains is expected to rise by 1.2%, reaching 1.5 billion tonnes in total consumption across food, seed, industrial, and feed use. Corn consumption is expected to increase to 1.2 billion tonnes. If achieved, this would represent the highest recorded levels of coarse grain and corn consumption. As two-thirds of this global consumption is used in feed, the high level of demand is reflected in increased global feed use:

• China continues to be the largest consumer of coarse grains, significantly influencing global feed demand in 2024–25 (Figure 1.6). The anticipated increase in feed for chickens, cattle and aquaculture is likely to offset the decreased demand in pig feed, with corn expected to make up a larger share of the feed mix as corn prices remain low. Strong competition for coarse grain exports to China, particularly from Brazil, is expected to ease as China focuses on reducing its stockpile. With Brazil's corn becoming increasingly competitive, China's demand for other coarse grain imports may decline, impacting global trade dynamics.
• Corn consumption in the United States is expected to remain stable in 2024–25. The high level of domestic supply is expected to support consumption, in particular grain feed.

Global consumption of barley is expected to increase by 5% to 150 million tonnes, reflecting increased grain feed consumption and stable food, seed and industrial consumption. Lower barley prices are expected to support consumption and lead to a drawdown of barley stocks.

Industrial consumption of coarse grains is expected to increase by 1% to 567 million tonnes. Low global prices, particularly for corn, are likely to boost ethanol production. However, demand for corn in ethanol production may face competition from high sugar and other grain production, influenced by blending mandates in some countries. While overall biofuel demand is expected to rise, it may be limited by lower oil prices in 2024–25 (see Economic Overview and Oilseeds).

Submission for sprouted sorghum to enter export market

The GTA (Grain Trade Australia) 2024–25 trading standard, implemented on 1 August 2024, introduces several updates. These include enhancements to the visual recognition standards, adjustments to bin grade rules, new milling grades, updated definitions, and revised tolerance levels for gumnuts. However, the industry is currently advocating for the establishment of a specific feed grade to better reflect the value of sprouted sorghum in livestock feed for the export market, as current standards do not recognise this value. Recognising a sorghum feed grade would ensure fair competition for growers by accurately reflecting the value of sprouted sorghum, benefiting both producers and the feed industry. Additionally, these adjustments aim to harmonise standards with international counterparts.

GRDC investment for barley

The Grains Research and Development Corporation (GRDC) will invest up to $245 million per annum from 2024–25 to 2027–28 in grains as part of the 2024–25 Research, Development and Extension plan. Key priorities include research and development to reduce head loss in barley, which involves minimising the loss of grains from the heads before or during harvest. Planned investments in barley screening processes and the development of phenotyping tools aim to reduce post-maturity head yield loss and enhance crop selection for resistance to such losses. These advancements are expected to improve yield stability and quality, thereby increasing the competitiveness of Australian barley in the global market.