Australia’s sugar crop is expected to avoid significant damage from a recent tropical storm in eastern parts of the country, although risks will grow if flooding in Queensland and northern New South Wales states persists, an industry body said.
The rains from ex-cyclone Oswald are also not expected to have a big impact on Australia’s eastern wheat crop, with the additional moisture potentially able to help the winter crop.
Australia is the world’s third-largest sugar exporter and early assessments on sugar production in Queensland, where most of the country’s sugar cane is grown, suggest the impact will not be major, industry group CaneGrowers Australia said.
“At this early stage, the overall Australian crop is still in good shape, but we need to wait until the flood waters subside to make a full assessment,” said Suzi Moore, a spokeswoman for CaneGrowers Australia, which says it represents around 80 percent of the country’s sugarcane growers.
New York sugar prices rallied to a 30-year high around 36 U.S. cents in February 2011 on damage to the crop in Australia from Cyclone Yasi.
March raw sugar futures on ICE were trading at 18.38 cents a lb on Monday, paring earlier gains after reaching 18.96 cents, their highest since Jan. 14.
The Australian Bureau of Agriculture and Resource Economics and Sciences (ABARES) in December pegged sugar production for the 2012/13 year at 4.50 million tonnes.
Grains handler GrainCorp said wheat from the 2011/12 season is likely to experience only small delays in the transport from silos to ports.
Analysts said 2012/13 season wheat planting, which is still several months away, could be aided by the heavy rains following a record heat wave, which has sapped soil moisture across the Australian east coast.
Australia’s cyclonic storm season runs from Nov. 1 to April 30.