Australian Crop Update – Week 16, 2025

A significant amount of grain was bought and sold in the past week making it the largest trading week in more than a year as traders swooped up the cheaper farmer offers which became workable with a lower AUD weakened by Trump’s China Tariff increases. The 5% plus movement in the AUD through the week – both up and down also offered selling opportunities for farmers and exporters. Although it seems demand remained muted as a lot of consumers continued to sit on the sidelines – concerned about further volatility and improving global weather that may widen the emerging inverse to northern hemisphere new crop values further. 

That said dry weather worries through South Australia (SA), Victoria (VIC) and Southern New South Wales (NSW) are building and is beginning to influence farmer decision making. Some farmers are holding off planting and we are also hearing southern farmers are holding back on forward fertiliser purchases they would normally be making at this time of the year due the dry outlook. Queensland (QLD) and Northern NSW on the other hand have received a good early break and Western Australia (WA) is also in fair condition. Soil moisture levels were near to above median in NSW, QLD, and WA, while below median in SA and VIC. The first week of April showed significantly above median levels in QLD, above median in NSW and WA, and a remaining soil moisture deficit in SA and VIC (below 80% of the median). 

Elsewhere, our analysts released their initial 2025/26 winter crop plantings, yields and production estimates last week. Overall wheat plantings should remain steady, but we expect farmers will trim total plantings in South East Australia. This shouldn’t apply to areas that have enjoyed a favourable start to the season, such as Northern NSW and much of WA. Barley plantings in the big states of WA and NSW are expected to be large and steady. 

There was 800 thousand metric tonne (KMT) of wheat vessel nominations added to the shipping stem in the past week, 141KMT of sorghum, 121KMT of barley and 58KMT of canola. It was the largest week for total stem additions in eight weeks. WA accounted for around 540KMT of the weekly wheat additions followed by NSW with 166KMT and the Vic with 94KMT. All the weekly barley additions were in WA, and this is unlikely to change with the continued dry weather in South East Australia.
 
The dry bulk shipping market has also been grappling with geopolitical volatility, creating uncertainty as both shipowners and charterers continue to feel the associated repercussions. Freight rates have been up and down like a yo-yo, keeping everyone on their toes and making the decision-making process difficult for anything longer than 20-30 days forward. Not surprisingly the spot rates took a hit across all sectors last week with market players erring on the side of caution rather than being prepared to make a bold play either way. However interestingly, remaining relatively firm are owner’s period rates (though there has been little evidence of fixing) which indicates many are still looking for more evidence that the fundamentals have changed before they are willing to consider reduced levels. For now, it’s very much a wait and see game with cautiousness still the status quo on both side of the market.

The upbeat tone across the markets and a weaker USD helped the Australian dollar to a strong close to last week. The bullish tone for the AUD emerges as the US dollar (USD) continues to weaken across the board, dragged by lower-than-expected economic data and growing investor concern over inflation and trade policy. While momentum is cautiously improving, we don’t think volatility is going away any time soon.