Australian Farmer Confidence Rises on Winter Rain, Bank Says

By Madelene Pearson

Aug. 31 (Bloomberg) -- Confidence among farmers in Australia, the world’s fourth-largest wheat shipper and third- largest canola exporter, grew for a second quarter, driven by rainfall in early winter, Rabobank Groep NV said.

The number of farmers who expect conditions to improve in the coming year climbed to 28 percent, up from 20 percent in the previous quarter, the bank, the world’s largest agricultural lender, said today, citing its latest Rural Confidence Survey. The number of farmers expecting conditions to worsen decreased to 25 percent, from 37 percent, it said in an e-mailed statement.

Australian farmers are waiting on rain needed to finish winter crops including wheat, barley and canola before the harvest starts in about November. Rabobank has predicted Australia’s wheat crop at 22.8 million metric tons, up from last year’s 21.4 million tons.

“Producers are now eagerly awaiting more rain to finish off what is shaping up as a good winter cropping season for many areas,” Peter Knoblanche, Rabobank general manager Rural Australia, said in the statement. “For many winter crop producers, the amount of rain needed to finish the crop was only modest and may be achieved despite possible generally drier conditions.”

The El Nino weather phenomenon, which can cause drought in the country, is developing, Australia’s weather bureau has said. The possible return of El Nino has caused concern and some caution among producers, Rabobank said.

Wheat futures for December delivery rose as much as 0.8 percent to $4.9650 on the Chicago Board of Trade in after-hours electronic trading at 11:42 a.m. in Sydney. The commodity has lost 38 percent in the past year.

To contact the reporter on this story: Madelene Pearson in Melbourne on mpearson1@bloomberg.net