Farmers say higher canola prices won’t mitigate low yields

Canola prices have started to climb following severe damage to the crop from recent frosts but farmers say it won’t mitigate low yields.

Canola prices have jumped to a two-year high at port in Victoria, but it is cold comfort for farmers who have cut crops for hay or are expecting low yields.

The port price climbed to $768/tonne this week before settling at $743/tonne on Wednesday. In Western Australia, the price hit $806/tonne.

Agricultural consultant Colin Peace said the Victoria port price represented a two-year high for canola.

“Crops in Western Australia are also struggling with many farmers receiving decile 1 rainfall during September and limited rain this month,” he said.

The price increase was attributed to a combination of frost damage and world markets, with uncertainty over the hostility in Israel and Iran.

The value was still a long way off the dizzy highs of 2021 when canola was commanding $1000/tonne.

Rupanyup grain grower Andrew Weidemann said the increase was due to overseas market concerns and also the impact frost was likely to have on overall yields.

He said the domestic market alone required 800,000 tonnes of canola for the crush and there were plenty of people expecting only about a third of their usual production from the oilseed crop.

He will start windrowing on Friday and is expecting yields to be substantially down.

“I could easily see prices going another $50 to $100/tonne higher,” he said.

Jason Mellings farms at Carron between Donald and Warracknabeal.

Jason Mellings, who farms at Carron between Donald and Warracknabeal, said there was no doubt tough seasonal conditions in Victoria and South Australia would impact overall canola supply.

“Right now, the higher the price, the better,” he said.

“Realistically, at $700/tonne, you are only just covering costs ... I’d like to see it get above $800/tonne,” he said.

The challenging season was likely to impact yields significantly, and Mr Mellings said it was possible there would be plenty of .5/tonnes per ha crops harvest.

Mr Mellings grows canola, wheat, barley and lentils and was expecting rainfall later this week.

“Good rain this week would be unreal; it could be a million-dollar rain event,” he said.

Ryan Milgate of Minyip. Picture: Yuri Kouzmin

Minyip farmer Ryan Milgate said while the price rise in canola was welcome, it would only go part of the way to mitigate the expected low yields.

“We would like to see the price go up a lot more,” he said.

“I’m looking at only about a quarter of the yields in canola compared to last year,” he said.

Mr Milgate said his property was fortunate not to be hit by frost as hard as some other districts, but the yields were still forecast to be lower due to the dry season.

He grows canola, wheat, barley, lentils and vetch.

The Australian Oilseeds Federation Crop Report released in August indicates a total yield estimate of 5,340,000 compared to 5,802,000 last year.

The report shows farmers planted 3,335,000ha of canola compared to 3,596,000 last year.