The case of the amazing shrinking 2016-17 crop
GRAIN growing groups are pointing at a massive discrepancy between two official Government bodies in terms of their estimates of the 2016-17 crop as a case for more transparent stocks reporting.
Controversy currently surrounds the final numbers for the 2016-17 wheat crop in particular, with the Australian Bureau of Statistics (ABS) earlier in the month coming out with an estimate of the final crop that was a whopping 4.65 million tonnes or 13.2 per cent lower than the figure released by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
The ABS has come out with its preliminary 2016-17 figure for wheat sitting at 30.35mt, still a national record, but far below the official ABARES estimate of 35mt.
An ABARES spokesperson said the organisation was looking into the discrepancy between the two numbers to see how the figures had come out so differently.
The methodologies in coming up with figures differ between the two agencies, with the ABARES focus on yield modelling.
Grain Producers Australia (GPA) chairman Andrew Weidemann said estimates played a big role in price setting and said the release of more data regarding grain being held in stocks would help get a more accurate figure.
“It is concerning when two leading agencies in regards to grain information can be so far out,” Mr Weidemann said.
“This is not just a matter of a small variance, the figures are very different – it’s a clear example of why we are calling for greater levels of stocks reporting.”
Mr Weidemann said at present the market was operating in a ‘black hole’.
“No one really knows how much grain is out there and that can be bad for everyone.
“It is not just growers, buyers may be using the higher estimates and then find when they enter the market the grain they expected is not there.”
AgForce grains section president Wayne Newton said growers were sceptical of the accuracy of Government crop estimates.
“There is a fair degree of cynicism surrounding the numbers that are put out, particularly when the market is suggesting something different,” Mr Newton said.
“It can be damaging for the industry when the official figures are out by so much, especially in some of the lower volume crops.
“We’ve seen it in the past, predictions of a big chickpea crop have not come through yet the buyers are still offering prices based on there being a surplus of product available.”
Mr Newton said the current divergence was difficult to understand as the crop was already in the bin.