Miller Magazine Issue: 121 January 2020

87 MARKET ANALYSIS MILLER / JANUARY 2020 Losses of crops, fodder, as well as compound feed, are expected across the country, with damage still early to be estimated, as Australia is now only mid-summer, and there is no indication that the weather may improve, ana- lysts predict. Among other things, it is forbidden to plant any crops in the areas covered by fires, and therefore this year's crop may be significantly less than in 2019. The total loss of livestock from Australian wildfires will exceed 100,000 heads, the federal government's agri- culture minister said. Tens of thousands of head of cattle and sheep were killed in forest fires, either by fire or by asphyxiation. Many farmers have lost all their crops or herds. The National Farmers Federation (NFF) has called for donations of food, food, water, household goods and monetary donations. Australian Agriculture Minister Bridget McKenzie has confirmed that army reservists are called to dig mass graves for dead animals “as a matter of priority” to avoid any potential biological hazards. Mackenzie has pro- posed placing another 100 veterinarians on the ground in states affected by wildfires to help euthanize thou- sands of injured animals. The federal government has announced the allocation of at least $ 2 billion over two years to restore pastures and help farmers. Austral- ian Prime Minister Scott Morrison has promised to do "everything necessary and more" to rebuild the country. December crop forecast from ABARES hasn’t include bushfires impact. Winter crop production is forecast to fall by 3% in 2019–20 to 29.4 MMT, which is a down- ward revision of 13% from the forecast ABARES published in September. Forecast produc- tion is around 27% below the 10-year average to 2018–19 and is set to fall for the third con- secutive year since record-high production was achieved in 2016–17. Winter crop produc- tion in Victoria is expected to account for around 24% of na- tional production, compared to an average of 16% over the 10-years to 2018–19. For the major winter crops, wheat pro- duction is forecast to decrease by 8% to around 15.9 MMT, 35% below the 10-year average to 2018–19. Barley production is forecast to increase by 4% to around 8.7 MMT, 3% below the 10-year average to 2018–19. Canola production is forecast to fall by 4% to around 2.1 MMT, 35% below the 10-year average to 2018–19. Amongst other crops, chickpea production is forecast to rise by 2% to 289,000 tones and oats production is forecast to rise by 5% to 935,000 tones. The next report will fettle numbers but anyway, the main negative effect Australian farmers got on the livestock industry. Secondly, Middle East geopolitical issues supported the oil market. Warnings about military flare-up around Iran shacked price curve. Talking on grains, we should bear in mind that Iran is an important player in the grain market, particularly with regional partners, although it is now at, or near, self-sufficiency in wheat. Iranians are among the biggest consumers of bread in the world and the government manages the supply of wheat to ensure adequate supplies. According to the International Grains Council (IGC), Iran’s total grains production in 2019-20 could come to 19 MMT, +0,5MMT YoY. Of the total, wheat accounts for an unchanged 14.5 MMT. Barley production is forecast at 3.2 MMT in 2019-20, vs 2.8 MMT YoY. Iran’s total imports of grains in 2019-20 are forecast at 13.3 MMT, up from 12.5 MMT YoY. It’s mostly corn: at 9.8 MMT, and around 5,5MMT of it – Brazilian ori- gin. Barley imports are forecast at 3.2 MMT in 2019- 20. Iran is forecast to import 2.2 MMT of soybeans in 2019-20, the same level as in the previous year. The IGC forecast for soymeal imports is also unchanged on the year at 2 MMT.