Australia agribusiness March 2024: Autumn outlook remain positive

Here are the main highlights for some of Australia’s key commodities this month. The full report provides an overview of the developments to watch in the upcoming weeks.

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Wheat and barley: The market remains bearish on the back of large crop volumes from the Black Sea region and soft feed demand, pushing exporter prices closer to parity despite geopolitics challenges.

Canola: Soft global demand for oilseed meal is affecting crushers’ margins, though there is hope for better prices as the carryover glut fades away and EU 2024 production is forecast to fall.

Dairy: Global milk supply growth continues to struggle, with 2H 2023 seeing weaker year-over-year production from the key exporting regions. A return to production expansion will take time and is not expected until 2H 2024.

Beef: The market has found balance. If seasonal conditions remain favourable, we think this balance will remain for the coming month, although increasing cattle supplies pose a downside risk.

Sheepmeat: After a strong rally in recent months, prices softened in February as elevated slaughter numbers hamper further upside. Production figures from 2023 show record lamb volumes hit the market.

Cotton: Cotton markets are seeing an ICE #2 price rally, but local prices remain around the AUD 700/bale mark. Tight US global supplies in 1H 2024 may get a boost with the improving US supply outlook for the 2024/25 season.

Wool: Wool prices slid marginally throughout February with the demand outlook remaining bearish as retail sales growth flatlined in key markets. Wool volumes hitting the market fell throughout the month.

Consumer foods: Fresh data releases provide glimpses into the performance of the Australian food market. Australian households face some challenges, which are impacting performance, but better times lay ahead.

Farm inputs: Bearish grain and oilseed markets keep pressuring farm inputs worldwide, skewing the balance towards supply even further and increasing the potential for further price reductions in Australia.

Interest rates and FX: The Australian dollar fell by a little over 1% in February as financial markets pared back bets on early rate cuts in the US. We expect the AUD/USD exchange rate to approach 0.70 over the next 12 months.

Energy and freight: Crude oil prices pushed higher again in February and diesel prices were also firmer. We see potential for a short-term pullback in March before prices rally further into the second half of the year.

  • Stefan Vogel

    General Manager – RaboResearch Australia & New Zealand
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  • Jen Corkran

    Senior Analyst – Animal Protein
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  • Anna Drake

    Sustainability Analyst
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  • Emma Higgins

    Senior Analyst – Agriculture
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  • Angus Gidley-Baird

    Senior Analyst – Animal Protein
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  • Pia Piggott

    Analyst – Associate Analyst
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  • Michael Harvey

    Senior Analyst – Dairy & Consumer Foods
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  • Vítor Caçula Pistóia

    Analyst – Farm Inputs
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  • Edward McGeoch

    Associate Analyst – Agri Commodities
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