With Australia’s sugarcane crushing season kicking off in May/June, WKS believes Australia’s new crop prospects are relatively strong, despite earlier fears that a monsoon deluge back in February would lower potential output. After a dry start to the year, the heavy rain event resulted in thousands of hectares of flooded cane farms from Mossman to Cairns in the north right down to the Herbert/Burdekin and the Central region. If cane fields were left standing in flood waters too long, there would be a negative impact on yields and sugar content (from stunted growth and side shoots) once the harvest commences in June. WKS suggested there was a high probability that the 2019 cane crush would be moderately lower than the 32.5 mln tonnes seen in 2018 (2.6% below the 2017 crush of 33.3 mln tonnes). With a probable lower average CCS level in the affected areas, Australia’s sugar production was also thought to certainly come in lower than last season’s 4.7 mln tonnes.
However, it now seems the rainfall event has generated a net positive impact for the new cane crop from Mackay and to the north. In the event, water drained from flooded areas relatively quickly, limiting crop damage. Furthermore, the rain favoured cane development in unflooded areas. It’s a less favourable outlook to the south of Mackay where the cane has suffered from prolonged dry conditions. Cane tonnage here is likely to be down. The Southern region has produced an annual average of 450,000 tonnes of cane over the past 5 years, accounting for around 10 % of Australia’s crop. Added to these two broad assessments are the negative impacts of localised losses of cane to bushfires around Mackay and Proserpine, and to heavy rainfall and wind from tropical cyclones.
WKS’s assessment is that cane production across all regions of Queensland, together with New South Wales, is still expected to be as much as 33.5 mln tonnes, up 1 mln tonnes or 3% from last season. Assuming average CCS content, sugar production would remain much the same as last season, at close to 4.7 mln tonnes tel quel. This assessment does come with a health warning: the full impacts of the summer weather conditions on the cane crop may yet still provide surprising results. The WKS-APIC Australian Crush Report, issued on a fortnightly basis during the season, provides up to date crush numbers and projections for the Aussie cane crush, as well as providing key insights into Australian sugar industry developments.
From an historical perspective, next year’s prospective cane and sugar production stays well within the range seen since the year 2000. Australia’s sugar production peaked in the late 1990s (5.57 mln tonnes). Output then declined during the mid to late 2000s, due to lower world prices together with a loss of area due to forestry and real estate development. Output bottomed in 2010 due to excessive wetness (65,000 ha or 18% unharvested) at 3.4 mln tonnes tel quel. Since 2010 a recovery phase began. It took 2 years for the cane crop to recover to produce 4.2 mln tonnes of sugar in 2012, up from 3.7 mln tonnes in the previous year. Production rose to a high of 4.9 mln tonnes in 2015 but eased lower again over the next few years, due in part to weather constraints (e.g. Cyclone Debbie in 2017). High sugar content boosted output in 2018 while dry weather reigned in cane tonnage.
