Ground Cover North : Ground Cover 089 November-December 2010 - North
By Melissa Marino n Thanks largely to advances in breeding, Australia’s lentil growers need only to hone their agronomy and fine-tune their marketing strategies to meet growing market demand and make the most from the food crop, says specialist pulse broker Peter Semmler. He says that given a favourable season, there is no excuse for not being able to grow a lentil crop that succeeds in the market. “All the heavy lifting has been done and that’s now manifested in the varieties,” he says. For example, he says, the green lentil, Boomer A , has opened new markets in North Africa and South America. For growers it is worth looking at a green lentil option because not only are they an untapped By Melissa Marino n The medium-term profitability of wheat production comes down to risk management, global product differentiation based on quality and service, and keeping a sharp look-out for opportunities in an evolving trading environment. This, in a nutshell, is the outlook presented by BRI principal economist and University of Sydney Emeritus Professor of Agricultural Economics, Gordon MacAulay, after a comprehensive study of economic conditions underpinning the global wheat market. Professor MacAulay says wheat markets are complex and risky because of inelastic supply and demand responses, so it only takes a small change in one or both to trigger a substantial change in price. Therefore, growers need a plan for both price dips and price spikes, he says. Professor MacAulay’s study was funded by the Grain Growers Association and the Department of Agriculture Fisheries and Forestry’s ‘Promoting Australian Produce’ program and presented at the recent GRDC Research Updates. Based on his research, he says crucial ways to manage fluctuations include having risk-management strategies covering storage, income diversification and financial reserves. november – december 2010 Ground cover Markets 15 Introducing Axioms Quality Grain Testing Equipment & Weighing Scales Manufactured and Supplied by 1 Hartog Place Wagga Wagga NSW, 2650 Phone. (02) 6923 0099 Fax. (02) 6923 0055 www.gtasolutions.com.au For more information call us on 1800 810 498 FREE Conversion Chart for test weight. PORTABLE HARVESTER Sample your grain without starting your header GRAin SPEARS Available in 1.5m & 2.0m lengths Rapid sampling Representive sample over the lot AXiOM GRAin SHAKER Designed to meet Australian standards. Positive drive system VACUUM GRAin SAMPLER Powerful suction action Variable speed suction motor GRAin WEiGHT SCALES Grain weight 1750g x 0.1g Kg/HL, Percentage screenings GRAin MOiSTURE METER Whole grain moisture analyser Simple digital calibration GRAin SiEVE SET Consists of grain screen 1/2 litre measure 5% screens measure PLATFORM SCALE Infield scale available with case Capacities 35kg - 150kg inSECT MAnAGEMEnT Insect tube traps. Insect screens Phosphene meters FOSS inFRATEC SOFiA Whole grain protein, oil & moisture analyser GRAinTEST WEiGHinG SCALE Kg/HL by means of a simple hand held scale HAY MOiSTURE METER Moisture & temperature Fast & accurate results Critically, he says, the farm environment and risk factors have to be managed to avoid or minimise poor quality product because the world is increasingly looking for higher quality. Professor MacAulay says the world stocks-to-use ratio published by the US Department of Agriculture is an important measure to monitor. “I think of it as the wheat industry thermometer,” he says. “If it’s going down expect prices to be rising, if it’s going up you can expect prices to be falling. And that’s globally.” Worldwide, the area planted to wheat is almost unchanged in 50 years. It is yield that has increased (from 200 million tonnes to 700 million tonnes) to meet demand – but Professor MacAulay says it would be a misjudgement for Australian growers to think this is where to focus. He argues that Australian growers should be concentrating on product differentiation through quality and service innovation – to develop a product that stands out to buyers – because Australian yields are highly variable and have grown slowly compared with international competitors. “Quality differences provide the basis for product differentiation and thus the potential to extract greater value from the market,” he says. “And to gain the advantages of product differentiation you need to understand the market for which you are producing.” Specifically, Professor MacAulay says meeting the needs of Indonesia – Australia’s biggest wheat customer – is crucial to the future of the wheat industry. Two of his BRI colleagues have recently returned from the region and will soon visit the Middle East gathering more information on the milling and baking requirements of several important trading partners. Professor MacAulay says if growers targeted niche markets they could move away from the idea of producing wheat in bulk and letting the system handle it. “There will always be bulk shipping, but a significant component of trade will be dealt with at a container level – a small bundle of product so you can differentiate,” he says. “I think that’s where we are headed ... although there are quality consistency issues to be solved before this will happen extensively.” He also notes that in the post-single desk trading environment it is important Australia’s reputation for quality is guarded. Growers have a pivotal role by trying to produce the best product they can from their land and resources, and making the right choices about what to produce with their soil, their equipment and their knowledge. □ GRDC Research Code ICN00011 More information: Gordon MacAulay, 02 9888 9600, email@example.com; www.grdc.com.au/Icn00011 Market study elevates quality and service LentiL Breeding expands Market horizons market, but they will move in a different price pattern to red lentil markets, he says. Australia’s stocks of recent commercial red lentil releases Nipper A , PBA Bounty A and PBA Flash A were boosted in September by two more – PBA Blitz A and PBA Jumbo A – providing further flexibility, choice and opportunities for growers seeking varieties that are best suited to their conditions. “Growers have got a lot more choice to find the optimum fit,” Mr Semmler says. “There are new lentil varieties with their own pros and cons, plus some growers will still find the older varieties fit them best and that’s fine. If it’s not broken, don’t fix it.” Key agronomic considerations include optimum sowing time, flowering window, season length and disease resistance, he says. With the number of varieties available, growers could consider a mix of red or green lentils or different sizes to spread risk. New varieties, he says, not only open up options for new markets, but also shore up existing ones by keeping Australian growers level with major competitor Canada. Marketing decisions should be made with an eye on overseas competitors and there are two key times to watch the market: May/June, when the Turkish crop is harvested, and August/ September, to assess the Canadian crop. This season, Australian growers could benefit by some $60 million as continual rain through harvest has affected the Canadian crop. He says this means green lentils could be at a $100 to $200 premium over red lentils. Growing conditions in Australia have been ideal, with just some drier, hotter weather needed to help ward off disease. Harvest timing is a critical factor in meeting market requirements, says Mr Semmler, as any unnecessary delay can lead to significant drop in quality and value. Some growers choose to harvest lentils with a slightly higher moisture content than is recommended and store them in aerated silos to maintain their quality. To maximise returns, Mr Semmler encourages growers to ensure they have chosen the right variety for their environment, then monitor the market and spend some time working on a marketing plan. □ GRDC Research Code DAV00072 More information: Peter Semmler, 0412 271 732, firstname.lastname@example.org; www.grdc.com.au/pba; www.grdc.com.au/dAv00072 Photo:brAdcollIs Cointainerised shipments to high-value niche markets seem set to become an increasing component of Australian wheat exports.
Ground Cover 090 January-February 2011 - North
Ground Cover 088 September-October 2010 - North