Country News, week of Tuesday, October 12, 2021 19
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Grains harvest
October 2021 8-page feature
Happy to hire Tim Gaffy (right, with Dylan Prentice) says farmers have been increasingly turning to machinery hire as the cost of agricultural machinery goes through the roof. More on pages 22 and 23.
Record run for commodities
T
he Australian agricultural sector continues to go from strength to strength, driving the NAB Rural Commodities Index 19.7 per cent higher than this time last year, to reach its highest ever level. NAB’s September Rural Commodities Wrap reports potential further upside for agricultural commodities, with the Bureau of Meteorology’s latest ENSO outlook indicating a 50 per cent chance of a La Niña event this spring. NAB agribusiness economist Phin Ziebell said a La Niña event could trigger even further gains in rural commodities. “The BoM has upgraded
its ENSO outlook to La Niña watch, with three of seven models pointing to a sustained La Niña event, lasting into 2022,” Mr Ziebell said. “This is reflected in the BoM’s long-range forecasts, which point to a wetter than average spring and start to summer, excluding Western Australia. “These conditions could drive gains in already eye-watering cattle prices, and will underpin an excellent winter crop. “While root zone moisture is currently sitting below average in many cropping regions after below average September rainfall, this is unlikely to impede a good season.”
While the Australian Bureau of Agricultural and Resource Economics and Sciences forecasts a wheat harvest of 32.6 million tonnes, just below last year’s all-time record, NAB expects conditions could see this forecast exceeded. “We have Australian wheat prices pencilled in around the $350/tonne mark for December,” Mr Ziebell said. “This combination of price and yield is likely to be one of the best in Australian history.” A rally in global oil seeds continues to underpin high canola prices, while barley prices remained comparatively low despite some gains in feed barley prices.
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Farm input prices continue to rise, with NAB expecting the trend to continue for the rest of the year, reflecting rises in global oil and grain prices, a weaker Australian dollar and high shipping costs. “Our feed grain price index has been trending upwards since a low in November 2020, reflecting higher global grain prices and the weak AUD. “If global prices continue to rise, there is scope for further upside despite plentiful domestic supplies.” The Australian dollar continues to underperform, with NAB’s forecast pointing to an up-tick to 0.78 US dollars by the end of the year.
Looking good: The likelihood of a wet spring and start to summer underpin optimistic commodity forecasts.
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grains harvest
Growers lock in ag inputs early
W
idespread global disruption to supply is set to see Australian farmers again move to lock in fertiliser and other inputs early for the season ahead, Rabobank says. This is despite global fertiliser prices at near-decade highs and expected to remain elevated in the short to medium term. In its semi-annual Global Fertiliser Outlook: High prices to test demand, the agribusiness banking specialist says global fertiliser prices have reached their highest level since 2012. And while these price highs will “test demand”, the report says, this will be in the short term, with the “global fertiliser complex” expected to remain supported due to ongoing high commodity prices. This global backdrop is set to underpin high Australian nitrogen (urea) and phosphate prices until at “least the end of the first quarter of 2022”, according to Rabobank’s senior agriculture analyst Wes Lefroy, driving another year of early input purchases for many Australian growers. And the challenges were not just confined to fertiliser, with global supply chain disruptions also impacting agri-chemicals, Mr Lefroy said. “2022 could be one of the toughest years that retailers of agri input supplies and farmers alike have seen
Cautionary tale: Rabobank’s Wes Lefroy says production and supply of inputs is being affected by weather events, the high price for raw materials, environmental regulation and freight disruptions. in recent times when it comes to acquiring inputs,” he said. “We see the production and supply of inputs being impacted by a combination of factors including weather events, the high price for raw materials, environmental regulation and freight being heavily disrupted. “Overlaid with strong local demand, this is really ratcheting up the pressure.” Mr Lefroy said with the current season nearing conclusion, farmers
were now turning their minds to the 2022 season, and in particular phosphate and other inputs, such as glyphosate, for spraying over the summer. “With no major price relief on the horizon and freight disruption continuing, this places farmers in a very difficult position ahead of the 2022 season.” He said ‘just-in-time’ purchases by farmers come with an increased risk of inputs only partially arriving or arriving late.
“Early purchasing, or locking in early purchases, not only ensures product availability when needed most, but also helps mitigate any further price rises.” For growers, higher fertiliser prices had already put pressure on margins during the 2021 season, Mr Lefroy said. “Fertiliser prices have risen much faster than local grain prices and this has considerably reduced the relative affordability of fertiliser,” he said. “Relative to grain prices, AUDadjusted global DAP (diammonium phosphate) prices are now the highest they have been for more than 10 years.” And with early indications already looking positive for local demand next season, it didn’t appear as if any of these factors would ease heading into 2022. “Indications from the Bureau of Meteorology that southern and eastern regions may experience above-average rainfall this summer could add further to farmer confidence and support summer demand for fertilisers and agri-chemicals ahead of the new season.”
Global price support
Globally, the Rabobank Fertiliser Outlook says, elevated fertiliser prices are expected to be “here to stay for at least the remainder of 2021”, primarily supported by demand fuelled by ongoing high agricultural
commodity prices. “From mid-2020 to mid-2021, prices of CBOT (Chicago Board of Trade) soy, corn and wheat either nearly doubled or more than doubled,” the report said, prompting farmers to increase application rates in pursuit of greater revenue potential. Demand pressures were “exacerbated by constraints on nitrogen, phosphate, and potash supplies”. These included the postponement of new nitrogen supply capacity in India and Nigeria, along with trade duties and sanctions in a number of countries. Rabobank expects global prices of corn, soybeans and wheat to continue to trade at high levels, at least until the third quarter of 2022, “incentivising” farmers across the globe to maintain high fertiliser application rates to leverage elevated prices.
Phosphate
In terms of the outlook for global phosphate markets, the report says “tight availability will hold phosphate prices at higher levels for some time”, with processed phosphate at its highest level since 2011. This, however, has seen phosphate become “less affordable for various crops in some regions, even with the higher commodity prices” and is likely to see some farmers purchase the “minimum
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All at sea: Ocean-freight costs are pushing up fertiliser costs and delivery times. level necessary”. But any price correction resulting from this drop in demand will be short-lived, the report says, with the International Fertiliser Association (IFA) forecasting the phosphate balance to be at its lowest level in more than five years as China is expected to limit the country’s exports in the second
half of the year.
Glyphosate
Mr Lefroy said the impact of high phosphate prices wasn’t just confined to fertiliser — demand had placed inflationary pressure on prices of glyphosate and a range of other agri-chemicals. “Prices of Chinese glyphosate
— the source of 65 per cent of global, and a large chunk of Australian, supplies — have increased 75 per cent this year,” he said. “In recent weeks, we have also seen a cap on the production of one of the key materials used in the production of glyphosate, which is likely to place further pressure on supply and prices.”
Freight issues
Mr Lefroy said inflated ocean-freight costs were also pushing fertiliser prices higher, adding as much as 10 per cent to a landed tonne of Australian fertiliser, with delivery times also “blowing out dramatically”. And these bulk and container freight dynamics are unlikely to improve before the end of the year, he said.
“As such, we see supply chain disruption — along with some concerns about input prices rising even higher — prompting farmers to purchase their inputs earlier than usual again this season. “If nothing else, we consider it’s important that buyers are in close communication with their suppliers, as early as possible.”
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Job’s right: The Gaffy’s Contracting Massey Ferguson Hesston windrower will be running non-stop through canola harvest. It’s also used for faba bean and straw windrowing.
Ready to roll out By Daneka Hill
G
affy’s Hire has added two new star machines to its fleet. With machinery hire and contracting work in such high demand, Tim Gaffy decided the time was right to invest in a brand new 6.25-metre Powerflex speed tiller and a six-metre Horsch Avatar air seeder.
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“The Horsch disc seeder is great for sowing straight into stubble, but if you need to prep a seed bed the 6.25-metre Kline Powerflex is the machine for you,” Mr Gaffy said. “We got them six months ago. We’ve got smaller tyne seeders but this is the first time we’ve expanded into the six-metre disc machines.” Farmers have been
increasingly turning to machinery hire as the cost of agricultural machinery goes through the roof. “Everything is always getting more expensive,” Mr Gaffy said. “The windrower we use for contract work was bought seven years ago for $250,000 and we looked at trading it in recently. “The dealership said they
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grains harvest
All geared up: Driver mechanic Dylan Prentice (left) and owner Tim Gaffy with some of Gaffy’s Hire equipment.
the big guns would take it and give us a new one if we paid $250,000. It was still worth about $170,000, but prices had gone up that much in just seven years.” The nine-metre draper front windrower and five-metre mower conditioner used by the family’s other business — Gaffy’s Contracting — are being pulled out of the shed and prepared for a sleep-depriving canola harvest come November.
“Once this thing starts it will run 24/7 until all the canola is done,” Mr Gaffy said. “The window for canola is small. You’ve got about two to three weeks to harvest everything.” Because of the tight window, Gaffy’s Contracting has only 10 canola clients. “It’s going to be a bumper season, the only question now is what the rain does,”
Next level: A brand new Horsch Avatar disc seeder was added to the stable six months ago. It’s marketed as a ‘new chapter in no-till farming’.
Mr Gaffy said. “If it keeps raining it will be a hard season for making hay and stripping crops. “We’re all very time poor during harvest and so storing your grain on-site is one way to avoid costly freight and length waits in silo queues.” Gaffy’s Hire doesn’t run harvesters, but stocks a range of grain bagging equipment for rent.
The latest equipment: A hire tractor with a new addition to Gaffy’s Hire — a multi-disc 6.25-metre Powerflex speed tiller.
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Optimising irrigated grains
A
field day will be held at the Finley Irrigated Research Centre on Wednesday, October 13 to show how irrigation systems affect various crops. FAR Australia research staff Ben Morris and Tom Price will be joined by Eshan Tavakkoli and Alex Schultz from NSW DPI, and agronomist Russell Ford. There will be three sessions covering a range of topics, including: What is the effect of soil amelioration and soil amendments on canola?
How do we keep cereal crops standing under irrigation? Getting the best out of your N application on Durum wheat. How do vetch varieties respond to various irrigation strategies, and what is the optimum cutting time (supported by Dairy Australia)? Moisture monitoring. A practical demonstration of how the trial farm has been fully automated. The sessions will be held at 8.30am, 10.30am and 1.30pm. Due to COVID-19
restrictions, numbers are limited and registration is essential. Proof of registration must be shown on the day and people are asked not to attend if their local government area is in lockdown on the day of the field day. The Finley Irrigated Research Centre is at 2431 Newell Hwy, Finley. ▯ Register attendance at your preferred session time with Rachel Hamilton on 0428 843 456 or at: rachel. hamilton@faraustralia. com.au
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grains harvest
Raising the bar in automation
A
FS Harvest Command, available on the Case IH AxialFlow 250 Series, monitors everything from ground speed and engine load all the way up to feedrate control and sieve settings, which are based on the feedback received from the loss sensors, a grain camera and sieve pressure sensors. These sieve pressure sensors are unique to CNH Industrial brands, including Case IH’s AFS Harvest Command product, and vital for ensuring the optimum performance of the combine. The sensors provide for the relay of data concerning the load on the sieve, which in turn allows the system to determine the difference between sieve overload and blow-out losses. A grain camera monitors grain quality, including cracked and broken kernels, as well as foreign material, allowing for the adjustment of settings as required. In fact, the AFS Harvest Command automation on the 250 Series uses 16 sensors to control a total of seven combine functions. “AFS Harvest Command is designed to maintain the greatest efficiency for the operator in all conditions, improving grain quality and grain savings through sensing and optimising machine settings,” Case IH Australia/New Zealand’s Tim Slater said. Recently, the number of crops
Shiny and new: The latest Axial-Flow 250 Series from Case IH features the AFS Harvest Command technology that offers a raft of benefits for customers. it’s designed to operate in has been expanded beyond corn, soybeans, wheat and canola, to now include barley and rice. Each new 250 series combine now also includes a subscription to Case IH’s AFS Connect with file transfer and telematics. AFS Connect is a tool that enables
a machine in the paddock to be monitored by a customer and their trusted advisers from anywhere with an internet connection. “The customer can also then give permission for their dealer to see similar information, which can help diagnose any potential faults and more efficiently deal with any
necessary repairs,” Mr Slater said. “Machine, harvesting and yield data are automatically sent to the AFS Connect portal where it’s processed and ready to be viewed via web browser or mobile device. “This negates the need to download the data from a USB in the combine, improving the safety of data and
offering a more convenient option.” Simplicity, productivity, grain quality and crop adaptability have been the hallmarks of the Case IH Axial-Flow series for almost 45 years, and Mr Slater said the introduction of AFS Harvest Command took this reputation to the next level.
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