EXPORT demand for Australian grain is expected to remain strong next year.
Rabobank's November Agribusiness Review predicts good demand for grains and oilseeds as "tight global balance sheets put pressure on prices in the Northern Hemisphere markets"."The Australian harvest has progressed well with northern parts of the cropping regions on both the east and west coasts rapidly nearing completion," the report says.
"On the east coast, reports of lower than average wheat protein levels due to a fairly mild finish is gaining a lot of market attention.
"Harvest is expected to be in full swing by mid-November and protein will be closely watched as harvest progresses further south.
"Yields of all winter crops will be closely watched with the extent of the frost damage now becoming apparent."
The report found post harvest rains would be crucial for grain growers in planting decisions for the 2013/14 season.
Rabobank analysts predicted the current elevated Australian dollar to remain in a similar position in the short term.
Fertiliser prices are also expected to remain stable.
The report found international dairy commodity would continue to strengthen, although it would be at a slow pace.
"Global supply across the key export supply regions is slowing in response to rising feed costs, lower milk prices and in some regions less than favourable weather," the report says.
"There has been a positive start to Southern Hemisphere spring peaks.
"In both Australia and New Zealand milk production was higher during the early parts of the growing season.
"However growth rates are trending lower as farmers confront lower milk prices, higher feed costs and less favourable seasonal conditions."
Northern Victoria however seemed to be a bit of an exception and remained "the standout region".
Milk supply in northern Victoria is up seven per cent for September compared to Gippsland where supply was down 2 per cent.
