Grain Crops Need Rainfall in West Australia, CBH Says

By Madelene Pearson

Sept. 3 (Bloomberg) -- Western Australia, the nation’s biggest wheat grower and exporter, needs significant rainfall to meet grain-output forecasts, according to CBH Group.

“We are receiving reports from an increasing number of areas that they are getting dry and the crop is going backward,” said Michael Musgrave, operations manager for the nation’s top wheat exporter. CBH is “quite concerned” for about one-third of the wheat-growing area, he said by phone.

Australia, the world’s fourth-largest wheat shipper, relies on rain at this time of year to boost yields in winter-grain crops ahead of the harvest from November. Western Australia usually accounts for about 40 percent of the nation’s grain output, with most of the state’s crops exported.

The state’s output of all grains is forecast at 10 million metric tons to 12 million tons, Musgrave said, restating a forecast. That compares with last year’s 12.3 million ton harvest, the third-largest on record, he said. Wheat usually accounts for about 70 percent of the state’s crop.

“Growers have put in more crop, but right now we really need a significant rainfall system,” he said. “At this point of time, it’s looking slightly worse than last year. We are still hopeful that we may get the 12 million tons.”

Wheat for December delivery fell 0.3 percent to $4.845 a bushel on the Chicago Board of Trade at 11:15 a.m. in Sydney. The commodity has fallen 21 percent this year.

Western Australia’s crop needs rain now, Musgrave said. It can last a couple more weeks without rain because of the regular, light showers the state had in the last month, he said. Output could go either way, Musgrave said.

“If we scored a front, then you would see us push above last year’s third-largest crop on record, but if we don’t we’ll struggle to deliver that,” he said, referring to a weather system that could bring rainfall. “The finishing rains really determine the yield and the size of the crop and we haven’t had that significant event yet.”

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