Crop commodity prices remained elevated for most commodities, with the crop price volume weighted indexes either at record or near record levels. Canola prices decreased from last years record high’s, as a modest increase in canola production from Canada lifted export competition for Australia. Cereal prices continued their march into record territory, with the supply disruptions created by the war in Ukraine and drought conditions in the Northern Hemisphere being the key catalyst for this result. A less prominent story over the past couple of years has been the elevated pulse prices which are a factor of east coast supply shortages, particularly for chickpeas, lower containerised shipping rates and increased demand for containerised chickpeas into Pakistan and field peas into China. As a result, overall broadacre cropping GVP was estimated to decline by 19.7% year on year to $9.2 billion in 2022-23.
Cropping
Cropping Gross Value of Production 2022-23 52
- GVP 2022-23 est.
- YOY % Change (RHS)
NSW Production Weighted Crop Price Index 1 164 z
- Cereals
- Oilseeds
- Pulses
- Cotton
The 2022-23 cropping season was one of the more challenging for both winter crops and summer crops alike. A negative Indian Ocean Dipole and strong La-Nina conditions combined over spring 2022, which resulted in well above average rainfall for most of NSW from August to November.
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The extreme rainfall also coincided with below average temperatures which meant winter crops matured late and inconsistently, while summer crop sowing was delayed or prevented due to waterlogged fields.
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Overall crop total crop plantings were estimated down approximately 7% year on year.
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Winter Crops
Winter crop plantings declined 9% year on year and 17% from the record plantings in 2020-21 respectively owing to a range of factors including increased livestock stocking levels, paddock rotations, elevated input costs and some noted general risk aversion from farmers due to events of recent seasons.
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Despite these factors, ample soil moisture at sowing and high commodity prices incentivised plantings approximately 7% higher than 10-year average levels.
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Average through to very much above average rainfall occurred for most of the state from March to May 2022 which allowed good soil moisture but did prevent some crops being planted due to waterlogged conditions. Wheat plantings remained relatively stable, but most other crop plantings declined slightly or modestly depending on the prevailing agronomic and market factors. Notably barley plantings declined 33% as the wheat-barley prices spread widened, and chickpea plantings declined 43% year on year with farmers opting for risk aversion as a result of increased disease pressure due to the wet conditions the two years prior.
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Early winter saw rainfall in June fell below average for much of the state before more stable conditions returned in July. A return of La-Nina and a negative Indian Ocean Dipole (IOD) climatic drivers resulted in above average rainfall in August and persisting through to November. The wet conditions created a range of challenges for the winter crop including delayed and uneven crop ripening, waterlogging and crop loss in some low lying areas adjacent to flood plains, yield and quality downgrades. Despite the challenging season total winter crop production was estimated at 15.1 million tonnes which is 30% above 10 year average levels and the fourth largest on record.
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As such the winter crop had a combined value of an estimated $6.1 billion, down 19% on the record levels the year prior.
Winter Crop Production 1
- Wheat
- Barley
- Canola
- Chickpeas
- Faba beans
- Field peas
- Lentils
- Lupins
- Oats
- Triticale
- Average Production
Summer Crops
The exceptionally wet spring caused flooding in some valleys and waterlogged fields impacted summer crop operations. Field preparations and crop sowing activities were delayed for some regions, with the impacts being felt acutely in the southern valleys. Rice production in the Riverina and Murray valleys was notably impacted, with an overall 17% annual decline in area planted. Other summer crop plantings remained relatively steady across the board, with cotton area increasing marginally by 1.5%, while sorghum area declined by just 1% year on year.
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Offsetting the challenging start to the season was near maximum water allocations across the major regulated water sources, which incentivised summer cropping activity.
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Total available water General Security (GS) and High Security (HS) allocations increased marginally over the past year, and remained at near maximum levels, exceeded in the last 20 years only by the water allocations in 2012-13.
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General Security allocations in the Northern Murray Darling Basin were estimated to have increased by approximately 11% as at the start of the summer cropping season, while Southern Murray Darling Basin GS allocations marginally declined by approximately 2% year on year.
187
188
m
Regulated River Water Source Allocations 187 188 1 m aa
- Northern MDB GS
- Northern MDB HS
- Southern MDB GS
- Southern MDB HS
- Combined Cotton & Rice Production (RHS)
Despite the wet start to the season, growing conditions generally stabilised at the beginning of the calendar year with more average conditions prevailing for the remainder of the growing season. However challenges remained and while irrigated crops were able to benefit from ample water allocations, dryland crops in some regions struggled to meet full potential due to the drier conditions.
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In addition, below average overnight temperatures in February for Southern growing regions impacted rice crop yield potentials.
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Overall growing conditions were more conducive to higher yields the further North that observations were made. Overall summer crop production fell by an estimated 15% to 3.2 million tonnes, with lower plantings of rice and lower yields for rice and cotton the major drivers behind the overall result. Overall the summer crop had an estimated value of $3.0 billion in 2022-23, down 21% year on year.
Summer Crop Production 1
- Sorghum
- Cottonseed
- Cotton lint
- Rice
- Maize
- Soybeans
- Sunflower
- Average Production
Outlook
Conditions leading into the 2023 winter cropping season were more challenging, with the dry conditions in Northern and Central NSW reducing winter crop area planted in these regions. This was offset by excellent conditions in Southern NSW, which partially offset the decline in plantings in Northern NSW and as a result the area planted only declined by a modest 5.6% year on year to 5.5 million hectares.
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Planting activities were also incentivised by relatively strong commodity prices supported by wheat supply disruptions caused the war in Ukraine, the prospect of dry conditions, the removal of tariffs for barley back into China and ongoing drought conditions in parts of Northern America. As the winter cropping season has progressed, conditions in Northern NSW have further deteriorated alongside the development of El-Nino conditions. As such the yield prospects for the winter crops have declined from earlier in the year with production forecast to be down 33% year on year at 10 million tonnes, and down 51% compared to the record highs of 2020-21.
Summer crop production has a slightly more positive outlook for the current year which is largely attributable to generally unchanged opening available water allocations and drier conditions which will likely support optimal sowing windows. While opening water allocations were comparable to last season, it remains to be seen whether these allocations increase as sharply leading into summer with the forecast drier conditions and potentially lower storage inflows. As a result, forecast summer crop area is forecast to decline modestly by 10% year on year. The warmer, drier conditions forecast, along with high water allocations is expected to be conducive to higher yields in the irrigated crops and in particular cotton, however dryland crops such as dryland cotton and sorghum are expected to receive a yield penalty under these conditions. Total summer crop production is forecast to remain stable at 3.15 million tonnes.
The overall crop forecast is likely to decline in 2023-24 with the preliminary forecast of an approximate 25% decline in value, although remaining roughly fourth highest on record. It is also important to note that, depending on how severely the El-Nino climatic driver expresses itself this summer and leading into the next crop cycle, the impacts could be more pronounced in the 2024-25 cropping year.
