Australian Crop Update – Week 41, 2025

Domestic markets were quiet last week with participants reporting limited activity. We are expecting it will remain quiet until harvest commences in earnest in a few weeks. Farmers are showing little interest in selling new crop wheat and barley at current prices and consequently, trade selling has dried up. Chickpeas are being harvested in Central Queensland (QLD) but demand is well down on last year.
 
Weekly NDVI data showed the most significant weekly declines were in South Australia (SA). The declines in SA, Southern New South Wales (NSW) and Victoria (VIC) are a signs these areas are now running short of moisture. It’s not uniform across the regions as rains have been variable and some areas a better than others, but all of Southeast Australia needs finishing rains to avoid yield losses. This has already triggered some farmers to start baling crops in parts of SA and hold back from selling. Big crops in Northern NSW, Southern QLD and Western Australia (WA) are assured.

There was 1.98 million metric tonne (MMT) of wheat exports in August down from 2.3MMT in July. This included 1.1MMT from WA and 675 thousand metric tonne (KMT) from NSW. Australia’s Oct/Aug exports are 18.77MMT with a month remaining in the 2024/25 marketing year. The Philippines was the largest destination with 426KMT followed by Indonesia with 310KMT. Australia’s exports of wheat to Africa have tumbled from >500KMT in Apr-Jun to <200KMT in Jul/Jul as the new crop Black Sea becomes the cheapest origin. Barley exports for Aug were 494KMT which was the smallest month since Oct 2024. WA shipped 206KMT and VIC 165KMT. China was the largest destination with 383KMT followed by Japan with 97KMT.

It was another quiet week for shipping stem additions. Weekly wheat additions fell to 182KMT. This consisted of 116KMT in NSW. No wheat vessels had been added in WA through to Thursday with the Friday changes yest to be published.
 
It is China's golden week this week and as expected the market appears to be well-balanced and will hold firm throughout the long holidays. The Atlantic for the Panamax and Ultramax sectors are still being well supported by grain demand, especially loading EC South America. The Pacific remained active as rates trended sideways for the most part, as a general lack of available tonnage was still a major factor (not helped by Typhoon Ragasa wrecking havoc on Philippines/South China regions).

AUD/USD Currency Update:

AUD/USD gained 0.15% to trade near 0.6625 to close out the week showing resilience despite weaker-than-expected trade figures. On Tuesday last week, the Reserve Bank of Australia kept its Official Cash Rate (OCR) steady at 3.6%, in line with expectations. However, the central bank signalled concern over inflation, stating that price pressures remain more persistent than anticipated. This hawkish tone suggests that the RBA may maintain or even tighten monetary policy further to keep inflation in check, providing some underlying support for the AUD to firm in the final months of 2025.