Australian orange exports increase but drought still burdens other sectors

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Rabobank’s agribusiness October outlook indicates growth in wine and fruit exports, but meat and grains are falling short.

The monthly report shows that fresh orange exports continue to grow in price and volume, as well as wine exports to Canada.

Canada is one of the top wine export destinations for Australia by value.

For July and August 2018, compared to the same period in 2017, Australian exports of all wine to Canada have lifted by about 17 per cent in volume and 7 per cent in value.

READ: Cattle prices trend down as drought conditions increase pressure in market

Fresh orange exports have grown substantially since 2013, with global trade data indicating total Australian fresh orange exports of 197,000 tonnes in 2017.

Global trade data shows that in 2017, key Australian export markets for oranges had increased in value by $107m, which is almost double the 2013 value.

Over the same period, export volumes grew by about 46,000 tonnes, an increase of about 50 per cent on 2013.

Despite growth in some wine and fruit markets, dry weather and frost damaged winter crops in the grains and oilseed sector, with south-west New South Wales missing out on much needed rain over September.

Rabobank reports that parts of Victoria, South Australia and Western Australia were hit with frosty conditions, which caused significant damage to crops.

The Frost and ongoing dry conditions have reduced 2018/19 new crop prospects on grains and oilseeds.

Wool supply is set to continue to fall in the coming months and a dry outlook gives downside potential for young cattle.

A three-month outlook of the weather is expected to bring little rain to the country.

Despite the dry conditions, cattle prices lifted slightly or stayed steady throughout September and some rainfall through eastern states provided hope and ability to hold cattle rather than sell them, Rabobank reports.

September slaughter numbers (567,400 head) in the eastern states continue to reflect the drought-induced sales, up 15 per cent year-on-year.

Beef exports for September (91,668 tonnes swt) remain high, up 4 per cent year-on-year.

China remains hungry for Australian beef with exports up 55 per cent year-on-year, however they still remain Australia’s fourth-largest export market behind Japan, the US, and South Korea.

Live exports in comparison to 2017 YTD (August) are up 21 per cent, with stronger volumes to Indonesia and Vietnam throughout the year to date up 10 per cent and 40 per cent respectively.

In addition, live exports to countries besides Indonesia and Vietnam (such as Malaysia and Middle East) has increased 195 per cent, since 2017 year-to-date.