Determine 1 exhibits planting areas for the large three winter crops over the past 25 years. This knowledge will be discovered within the Australian Bureau of Agricultural and Useful resource Economics and Sciences (ABARES) crop report knowledge. You may as well delve into state knowledge if you’d like a regional perspective.
We will see in Determine 1 that every one crops have vital variation in planted areas relying on how the season begins, and subsoil moisture. Wheat space has been comparatively regular since 2020. Barley plantings took a dip in 2021-22 because of Chinese language tariffs miserable costs. Barley plantings have since recovered considerably however usually are not again to the place they had been pre-2021.
The world planted to every crop is determined by seasons, crop rotations and naturally value. Determine 2 exhibits the value of canola and barley at Geelong in March of the planting yr. In concept stronger value and margins for canola would encourage extra plantings, and vice versa with barley.
It isn’t that simple to inform merely space and value charts, so in determine 3 we now have put them on the identical chart. Determine 3 exhibits the premium canola held over barley in March of the planting yr, together with the barley canola planted space ratio. It’s clear on determine 3 {that a} stronger premium for canola in March sees the ratio of barley/canola planting fall.
The small canola value premium in 2019 noticed barley value rise relative to canola, however this may have had a bit to do with the late break and lack of subsoil moisture as effectively.
The final two years have seen value premiums and planting ratios stay comparatively regular. The present value premium for canola over barley is near 1.5, with canola at $740/t and barley $300/t. The final time we noticed this premium was in 2022, when barley plantings had been simply solely marginally bigger than canola.
