The market for feed grain should remain buoyant in Queensland and northern New South Wales, with a recent study highlighting the prospect of rapid growth in demand – from 2.8 to 3.6 million tonnes – over the next three years.

However, the study also pointed to a shortfall in ability to supply this demand in around 30 per cent of years. While south east Australia usually has a feed grain surplus able to be bought into the northern region, irregular grain imports may still be necessary, as in the current drought.

Agricultural Production Systems Research Unit (APSRU) researchers Graeme Hammer, Andreas Potgieter and Rod Strahan undertook the study because of industry concern about the reliability of feed grain supply in an environment of strongly growing demand from intensive livestock production and industrial users.

They found grain demand for feedlots growing at 7.4 per cent a year from the current 1,150,000 tonnes, for piggeries at 10.0 per cent from 367,000 tonnes and for poultry (layers and meat) both at 2.5 per cent from the current 335,000 tonnes.

Demand from the dairy industry was static, at 184,000 tonnes, while proposed ethanol plants were expected to be in the market for 200,000 tonnes annually in three years time.

Mr Potgieter detailed the team’s findings to the Fifth Australian Maize Conference in Toowoomba, which was supported by growers and the Federal Government through the Grains Research & Development Corporation (GRDC).

He told conference delegates the APSRU research team used computer models and 100 years of climate information to simulate annual grain yield in all grain producing shires in Queensland and northern NSW.

Feed grain supply was estimated using shire scale yield prediction models for wheat and sorghum that had been calibrated against recent Australian Bureau of Statistics production data.

Other crops making lesser contributions to the total feed grain pool – like barley and maize – were included by considering their recorded relationships to the major winter and summer crops – barley consistently 20 per cent of wheat and maize 20 per cent of sorghum.

The team calculated feed grain demand for the major industries – beef feedlots, pigs, poultry and dairy farming – based on their current size and rate of grain use.

With the development of new industrial users of grain.. notably ethanol.. and by projecting the current growth rate of the intensive livestock industries, it was estimated total demand would grow from the current 2.8 million tonnes to about 3.6 million tonnes in three years time.

"The median annual feed grain supply for an average area planted is about 3.1 million tonnes, but this varies from 1.2 to 4.1 million tonnes, depending on seasonal conditions,’’ Mr Potgieter told the maize conference.

"Variations in area planted from year to year will also affect this result. The average area planted used in the simulation was 1.7 million hectares, but that can vary by 0.5 million hectares, plus or minus, in any year, depending on planting conditions and relative prices."

The APSRU research team found that, while the market can be counted on to solve short term shortages of feed grain – sourcing it from southern Australia or overseas – efficiencies could be gained by seeking solutions at a higher level of industry coordination.