Seasonal conditions: September quarter 2021

Matthew Miller

Global production conditions mixed due to dryness in key growing regions

Global production conditions over the 3 months to 31 July 2021 have been mixed (Figure 1). Excessive heat and a lack of rainfall have affected the production potential of wheat and corn, and to a lesser extent soybeans, for some key grain producers (Figure 2). In contrast, above average rainfall and a favourable climate outlook in Australia, the European Union and Ukraine is expected to be partially offset by downward revisions in production for other major producers.

Production conditions for wheat declined further during July for key grain exporters including Canada, the United States and the Russian Federation. This represents a deterioration in conditions compared to what was expected in April, which were used to formulate ABARES forecasts of global grain supplies and world prices reported in Agricultural commodities: June quarter 2021.

In the southern hemisphere, rainfall over the 3 months to 31 July 2021 affected development and yield prospects of winter crops, and the soil moisture available for summer crops. In the same period, rainfall was generally below average across much of Brazil and parts of southern Argentina. In Brazil, harvesting of summer-planted crops is underway, but low rainfall and periods of frost during critical grain development stages are likely to result in below average yields. Despite some variable rainfall in Argentina, harvesting of summer-planted crops is underway and average yields are expected.

In Australia, average to above average rainfall during May in western cropping regions and during June in the east resulted in a boost to soil moisture levels. This created ideal growing conditions for wheat, barley and canola in the 2 largest grain-producing states – New South Wales and Western Australia. However, a drier than normal May and June across parts of southern Australia saw a late start to the growing season in some areas of Victoria and South Australia. These areas will rely on continued rainfall throughout the remainder of the growing season to maintain crop production potential.

In the northern hemisphere, May to July 2021 rainfall affected the development and yield prospects of spring wheat and canola crops, as well as summer crops such as corn, cotton, rice, sunflowers and grain sorghum.

Over the 3 months to 31 July 2021, below average rainfall and unseasonably hot temperatures have reduced production prospects across much of Canada, Kazakhstan, Turkey, the Russian Federation, northern United States and parts of central United States. In contrast, rainfall was above average across the eastern and southern United States, India, China, Ukraine, South-East Asia and parts of the European Union. This is expected to benefit crop production in these regions.

For assessments of global crop production conditions, by commodity, see ABARES Weekly Australian climate, water and agricultural update – 19 August 2021 .

 

 

Global climate outlook is mixed

The global climate outlook indicates that average to above average rainfall is more likely between September and November 2021 for some of the world’s major grain-producing and oilseed-producing regions. If realised, this is likely to benefit corn, soybeans, sunflower, millet, rice, sorghum and cotton production and wheat and rapeseed planting in the northern hemisphere. In Australia, this positive outlook will support winter wheat and canola production along with grain sorghum and cotton planting.

However, below average rainfall is more likely across much of Argentina and southern Brazil. This would adversely affect the development of wheat crops, and the planting of corn, soybeans, sorghum, cotton, sunflower, rice and millet. Below average rainfall between September and November 2021 is also more likely for parts of the Russian Federation, China and the United States. This is likely to benefit the harvest of spring wheat and canola in these northern hemisphere growing regions, but adversely affect the development of corn, cotton, soybeans, sorghum and sunflower.

For assessments of the climate outlook and potential impact on production conditions, by country, see ABARES Weekly Australian climate, water and agricultural update – 19 August 2021.

Australian production prospects good at the start of spring

The rainfall, current production conditions and climate outlook data presented here were used to update ABARES forecasts of Australian food and fibre production for 2021–22.

Despite variable rainfall in June and July, average to well above average pasture growth rates and winter crop yield potentials were preserved across most southern Australian growing regions. This was due to a drawdown of soil moisture reserves built up during late summer and autumn. Parts of western Victoria and eastern South Australia recorded below average rainfall between January and April, but they recorded average to above average falls from May to July (Figure 3). Rainfall for August 2021 was close to average across some key winter crop producing regions, supporting the final stages of winter crop development and providing a reliable base for the early planting of summer crops.

For a comprehensive assessment of recent agricultural production conditions, the climate outlook and potential impact on production, see ABARES Weekly Australian climate, water and agricultural update – 2 September 2021.

Increased water storage boosts irrigated crop prospects

Reservoir storage levels have improved significantly in the Murray–Darling Basin water supply system. At 25 August 2021 the current volume of water held in storage was 20,119 GL, which represents 79% of total capacity. This is 46% or 6,300 GL more than at the same time in 2020. Increased on-farm dam and reservoir storages offer favourable irrigated planting prospects in New South Wales and southern Queensland (see Natural fibres). See ABARES Water Market Outlook for a summary of water market conditions and forecasts of allocation prices in the southern Murray–Darling Basin.

Average or better rainfall likely across much of Australia

During spring, the climate drivers with the largest potential impact on Australia’s climate patterns are the El Niño–Southern Oscillation (ENSO) and the Indian Ocean Dipole (IOD). A negative IOD event persisted throughout August and is expected to continue into spring. A negative IOD event increases the chance of above average rainfall for southern and eastern Australia and the far north during winter and spring. It is also typically associated with an early onset of northern rainfall. Oceanic and atmospheric indicators show ENSO conditions remain neutral, reducing its influence on Australia’s climate. International climate models surveyed by the Bureau of Meteorology also show that ENSO conditions are likely to remain neutral throughout September.

According to the Bureau of Meteorology's climate outlook for September to November 2021 (published on 19 August 2021), there is a greater than 75% chance of exceeding median rainfall across much of New South Wales, Queensland, Victoria, South Australia and the Northern Territory, as well as parts of eastern Western Australia. There is a less than 40% chance of exceeding median rainfall across parts of the west of Western Australia.

A combination of expected rainfall and stored soil moisture is likely to be sufficient to support average to well above average crop and pasture production across most of Australia. There is a 75% chance of receiving between 50 mm and 200 mm between September and November across cropping regions in New South Wales, northern and eastern Queensland, Victoria, southern South Australia and parts of Western Australia (Figure 4).

Rainfall of less than 50 mm between September and November is expected in some northern Western Australian cropping regions. These forecast rainfall totals are slightly below average for this three-month period. However, the forecasts indicate a 50% chance of these regions receiving between 10 mm and 25 mm of rainfall in September 2021, which should be sufficient to maintain yield prospects at the critical grain development stage of growth. This is particularly the case in Western Australia due to high occurrence of sandier soils, meaning that any rainfall that falls is readily available to support crop production. In these areas the timing of rainfall, rather than the total amount received, is often more important in determining yield prospects.

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