Welcome to the Winter edition of “Take Ten”, our quarterly rural newsletter. In this edition Sam Wark explores the global pulse market with a specific look at the growth in Lentil production here in SA.

We also caught up with Magic Millions Managing Director Barry Bowditch to find out how the thoroughbred yearling sale market faired in 2024. Finally, Matt Benson gives us an insight into what the cattle markets could be doing over the next six months.

Our TOOP+TOOP RURAL team has grown again with the recent addition of Nigel Gosse. Nigel has joined us after having built a career promoting Australian agriculture to the world via roles at Meat and Livestock Australia and Woolmark Company. Nigel’s broad network and understanding of the agri-business make him very well placed to help you buy or sell your next farm.

We hope you enjoy the Winter Edition of Take Ten.

Our team: Bronte Manuel, Nigel Gosse, Sam Hayes, Matt Benson & Sam Wark

Click to articles:

• LENTIL AS ANYTHING

• What now for the cattle market?

• 2024 Yearling Sale Review with Barry Bowditch

• Meet Nigel Goss, our newest team member

LENTIL AS ANYTHING

With Sam Wark

Exports of lentils have been increasing recently. In 2022-23 export of lentils from SA, in terms of volume, increased by 71% compared with the previous year and reached over 900,000 tonnes. Most of this increase came from exports to India (389,000 tonnes), the largest export market for SA lentils in 2022-23. In the current financial year (2023-24), already over 338,000 tonnes have been exported to India. Extension of tariff-free export to India to 31 March 2025 will be providing confidence for this year’s crop. India might likely increase lentil imports in the future as it relies heavily on imports to meet demands (India is by far the largest importer of lentils in the world, accounting for more than one-third of global lentil imports) and there is a widening gap in demand and supply of pulses in South Asia (CGIAR, 2023). Overall, Asian markets account for 52% of all consumption but only about 43% of production, making it the most important market for SA and Australian pulses.

Credit: South Australian Research and Development Institute – SARDI|Department of Primary Industries and Regions

A current global pulse and lentil market overview.

The global pulse market has grown at an average annual rate of 1.7% over the past decade (OECD-FAO 2023) and per capita consumption is projected to grow in all regions of the world. This is driven by the health and environmental benefits of pulses, which can be used as a meat substitute or processed into ready-to-eat snack food (ABARES, 2023). World trade of pulses grew from 15 million tonnes to 19 million tonnes over the past decade and is projected to reach 23Mt by 2032 (OECD, 2023).

The global lentil market attained a volume of 8.45 million tonnes in 2022, aided by increasing demand for plant-based protein sources and growing adoption of healthy diets, the market is expected to grow at a Compound Annual Growth Rate of 1.8% between 2023 and 2028 to reach a volume of 9.42 million tonnes by 2028 (Research and Markets , 2023).

What is SA’s current total pulse production? (NB: Pulse description includes lentils, chickpeas, peas, beans and lupins)

Total pulse production in South Australia during the 2023-24 season was 777,000 tonnes with lentils (362,000 tonnes) making up almost half of the total. Compared to the record harvest of 2022-23, this was a decrease of 35% but still more than the previous five-year average. SA produces around a quarter of Australia’s pulses, with it being the largest lentil producer, typically producing more than half of the nation’s lentils.

The Yorke Peninsula produced 226,000 tonnes (62% of the state’s total) of lentils from 133,000 hectares (55% of the state). Area in 2023-24 increased by 3.5% compared with the previous season and is expected to increase in 2024-25 season.

Lentil production in the Mid-North during 2023-24 was 30,000 tonnes from 20,000 hectares. Area under cultivation nearly doubled since the 2019-2020 season. A late season frost event occurred in October 2023 which had a significant impact although many crops were unaffected.

What is the future for South Australian pulse growers and exporters?

In SA, producers are growing more lentils. The Crop and Pasture report shows around 240,000 hectares of lentils were planted last season in SA, which continued the strong growth in the area planted, and roughly 30% above the five-year average. The 2023/24 Eyre Peninsula lentil harvest came from an estimated 50,000 hectares, a substantial increase from 13,000 hectares the year before. While we do not have definitive estimates yet, we expect to see more lentils again this season on the Eyre Peninsula. Early indications are that this may not come as direct replacement of other crops, but that some producers are looking to substitute lentils for livestock production.

South Australian Crop and Pasture Report: 2023–24 Crop Performance Summary (pir.sa.gov.au)

Article Information Credit: Department of Primary Industries and Regions South Australia Spokesperson.

Research and Development around pulse / plant protein development at SARDI.

SARDI is a key partner in national, GRDC-funded pulse protein research that is characterising the protein and related functional attributes of diversity sets across the major pulse crops. The SARDI Agronomy teams at Clare and Struan are conducting field trials of lentil, field pea and lupin for these activities. Pre-breeding research at SARDI is focussed on the identification of genes regulating protein content. Novel genetics in chickpea are being exploited, with knowledge to be applied to other pulse crops and an overall objective to improve plant protein content whilst maintaining yield.

SARDI Food Sciences team has optimised the dry-fractionation method to produce protein concentrates from a range of locally grown pulse crops. Dry-fractionation results in two outputs, starch-enriched and protein-enriched fractions, and they both have benefits in particular food manufacturing applications. The dry-fractionation process does not involve any use of water and it provides a minimally processed product with very little waste generation. Protein concentrates can be used in a variety of food products such as pasta, bakery products, and plant-based milk and meat analogues. SARDI is also working on value addition of whole pulses by generating various food prototypes such as pasta with pulse flour and alternative to baked beans type of products. SARDI is utilising its Food Pilot Facility to produce the food prototypes for further evaluation and sensory assessment.

Article Information Credit: South Australian Research and Development Institute – SARDI | Department of Primary Industries and Regions

What now for the cattle market? 

With Matt Benson

I was hoping to pen an article at the start of Winter about the wonderful break to the season and the consequent resurgence in livestock prices across the board. Notwithstanding the much healthier market indicators now than prior to Christmas, trying to work out what might happen to cattle prices, even after some recent rain, is still a vexed challenge.

All of the long-term weather forecasters, including the BOM, correctly predicted a later than average break to the season – and for the vast majority of producers, the recent 20+mm that fell was very welcome – but some more is needed in the coming weeks. The flip side and silver-lining to the tough start this year, is that the same cohort of experts are saying that a possible ‘La Nina’ event is building and the prospects of a wetter-than-average spring are pretty good.

So, weather worries, the tense geo-political landscape and volatile demand are all contributing to our local cattle market levels – but are not the only factors involved. The combination of ongoing cost-of-living pressures and the USA beef herd might also be key players, and this is why the latter factor might have a much stronger influence than usual.

The US cattle herd is at its lowest number for over 70 years – with a snapshot of the last 25 years shown below:

Source: www.beefcentral.com/news

It would appear that a combination of the lower supply realities in the US due to drought and input cost increases, a stronger demand for cheaper cuts of meat due to current cost-of-living pressures – reflected in the ‘grinder’ meat prices now being at records levels, and the start of the northern Summer i.e. BBQ season - have come together to see prices across the board trend upwards.

Simon Quilty from international market analyst Global Agritrends, told a Wagyu Conference in early April that he expected a sustained increase in cattle prices through to 2027 – and a ‘new-norm’ would be seen with feeder-steer liveweight prices lifting from their current level of around 355c/kg, to 470c/kg next year and potentially 630 c/kg the year after.

The relative strength of the current market for heavy cattle going for processing compared to lighter ‘store’ steers and heifers – which are purchased by farmers, indicates that the Autumn dry is playing on the minds of local producers. Widespread rainfall in much of NSW has increased the grower demand for store cattle, and we have heard of significant orders from interstate for lighter stock to be sourced out of SA. This has helped stabilise the light end of the market which is a good outcome for producers who have had to offload stock in recent weeks due to a paucity of paddock feed and the difficulty in sourcing hay now at a reasonable price.

So, if you have the feed and the fortitude – now may actually be a pretty good time to buy lighter cattle in, especially heifers, at what some are suggesting are reasonable prices relative to what might happen in the market in the next couple of years.

2024 Yearling Sale Review with Barry Bowditch

Sam Hayes ‘took ten’ with Magic Millions Managing Director Barry Bowditch to chat about the 2024 thoroughbred yearling sales season. With cost-of-living pressures and higher interest rates being blamed for lowering retail forecasts and dampening results, just how did the sales bear up in the circumstances?

SH - Were the results of the 2024 sale season in line with your forecasts or original expectations?

BB - I think this year was in line with our expectations leading into the sales season. The top-end really held together whilst the lower-end got significantly tougher. All in all, given the current economic climate, the bloodstock industry locally continues to be in good shape.

SH - What have average yearling sale prices done over the past three years?

BB - Up until this year yearling sale averages had been holding a similar line whereas during the 2024 season both clearance rates and averages have dropped. On a whole nothing too significant with the average being off less than 10% for Magic Millions Sales.

SH - What is driving demand… is it largely local buyers?

BB - It varies depending on what level of the market you are playing in. At the top end we are looking at both local and international participation - especially with the colt funds really holding up that end of the market. As you get further down the price levels, we are more reliant on the locals and in particular trainers, syndicators and traders.

SH - Does the sire or the broodmare have a bigger impact on the sale price?

BB - I think both are equally as important as each other, but the big driver for top price is always the confirmation and physical attribute that the yearling possesses.

SH - Are there many breeders with one or two mares or is the industry more commercial today than it was in the past?

BB - I think as the years go on, we have seen that we visit less farms to see yearlings and see more yearlings sold by the bigger farms. In saying this I think many breeders find it easier to agist their yearlings at these farms then have their own farm for the raising of horses that is. The industry is far more commercial and there are definitely less people breeding to race which is a shame as the prizemoney levels here in Australia are as high as any open jurisdiction in the world.

SH - If you were to buy a yearling and you had an unlimited budget, what price bracket would you shop in?

BB - I think the answer is to do your work at all levels, you never know where the next star racehorse could come from and you just have to ready and lucky to enough to secure that horse when the opportunity presents itself.

Nigel Gosse joins Toop+Toop Rural

After a career promoting Australia’s agricultural exploits to the world, Nigel Gosse has returned home to South Australia where it all began.

Growing up on the family farm in the mid-north wool growing had been in Gosse’s blood for over five generations. This led to a career in several facets of the livestock and wool industry.

Mr Gosse’s career has included stints as jackeroo, farm overseer, sheep contractor, wool technical officer, rural journalist, and public relations consultant.

Gosse worked for Meat & Livestock Australia for more than seven years as business development manager for Europe and Russia and was The Woolmark Company’s country manager for the United Kingdom and Turkey for four years before being promoted to the role of General Manager of Operations.

Gosse was instrumental in shaping the United Kingdom and Turkey offices for AWI establishing several major and successful campaigns and projects including adidas, Woolmark Performance Challenge, Campaign for Wool and the Commonwealth Fashion Exchange with Eco Age.

“My underlying passion has always been grounded in the land. We have a library of rural property brochures at home so this transition into buying and selling farms feels entirely natural,” Gosse explained.

Gosse joins the growing team at Toop+Toop Rural a business founded two years ago by Adelaide couple Bronte Manuel and Genevieve Toop in partnership with Sam Hayes.

Matt Benson and Sam Wark joined the team in late 2023 adding more experience in agriculture, advertising, marketing, and sales.

“I was attracted to the fact it is a well-connected family-owned business with a bespoke approach. They have quickly carved out a niche in the market and our values were very much aligned,” Gosse said.

Toop+Toop Rural have sold over $120m in rural properties across South Australia since mid 2022.