Rural Bank senior agribusiness relationship manager Dean Lalor was a speaker at an open day at the DairyTas focus farm in Montagu.
He said the impact of drought and frost on the country’s cereal crops had led to grain that would normally be exported being taken up by domestic livestock industries.
Mr Lalor said the exception to poor wheat forecasts was Western Australia, which is tipped to produce 10 million metric tonnes of the national total of 16 million tonnes.
“That’s where all the grain is going to come from,” Mr Lalor said.
“People in WA, if it’s not going to their normal markets they’re going to want a premium. Then there’s a huge cost to get it from Western Australia to here.”
Mr Lalor said the cost of transporting grain from WA through to Victoria and then to Tasmania would push dairy farmers’ costs up.
“It has got to go in bulk on ship to port in Victoria, then it’s got to be handled, put into containers, and then brought through here,” he said.
While biosecurity could be an issue, sourcing wheat directly from WA in bulk shipments could be one solution.
“The industry as a whole needs to look at other alternatives,” Mr Lalor said.
“I’m all for biosecurity, the last thing we need is to be bringing in weeds, but we need to work out a way to get more grain into the state. “
He said Tasmania was a net importer of grain and needed to look at alternatives because there was a chance the situation would continue into 2019.
While there has been some small price relief as new season grain has come into the supply chain, Mr Lalor said the only real solution was rain.
“We’ve seen some relief and there’s been some recently from the current harvest.
“The biggest relief will come when the mainland gets rain and the feeders over there have grass again.”
Globally there are signs of pressure on grain supplies.
Mr Lalor said the United States tipped there could be a could be a global deficit of 12 million metric tonnes, but this could double depending on demand from China.
He said farmers in Tasmania were worried about grain prices.
“Grain is one of the major costs of dairy operations, so when it has gone from $280 to $300 a tonne to $500 or $550, it’s a concern.”
Over the longer term, Mr Lalor said lifting local production could help reduce reliance on imported grain.
