Update

Australia agribusiness July 2025: Back in the game, thanks to rain

2 July 2025 16:13 RaboResearch
Download

Australia’s key commodities highlights and economic influences for this month. The full report covers the developments to watch in the upcoming weeks.

2528001487

Here are the main highlights for some of Australia's key commodities and economic influences for this month. The full report provides an overview of the developments to watch in the upcoming weeks.

    Wheat and barley: Global wheat prices briefly rose on Middle East tensions, but the strong supply for 2025/26 outweighed it. Concerns about North American spring wheat have lifted high-protein wheat prices. Barley faces pressure from a well-supplied feed market on the back of large corn production coming from the US. Canola: Geopolitical tensions, biofuel policy shifts, and a crude oil rally drove canola prices higher, while uncertain Canadian crop conditions and concerns over excess meal supply added complexity to the market outlook. Beef: Cattle prices continue to trend upwards, with strong rises seen in heavy finished steers and cow prices, reflecting the stronger demand for these categories. Prices and volumes are expected to remain high as demand out of the US remains strong, but are there cracks appearing in US consumer demand? Sheepmeat: Have new record-high lamb prices overcooked the market? Or was it more the case that processors were testing how many lambs remained? We believe that, with lamb numbers dropping, prices will now also ease back down to around the AUD 8/kg mark. Wool: EMI prices have been stable over the past month, with prices hovering around the AUD 12/kg level. Declining production appears to be offsetting weak global demand. Cotton: US futures have found strong support over the past 10 days, as production uncertainty is supporting prices. Australian cash prices have recorded more modest price increases as Australian dollar strength is partially offsetting global supply question marks. Farm inputs: Urea prices have been very volatile over the past month amid the Middle East conflict. Although a ceasefire is now in place, urea prices remain elevated. The market will be closely watching for any further developments. Dairy: A wave of announcements from dairy companies through June mean that farmgate milk prices for 2025/26 across southern Australia will range between AUD 9.00 to AUD 10.00/kgMS. This represents an increase of around 10% on the final milk prices for the 2024/25 season. Consumer foods: Monthly food inflation fell below 3% in May. Coffee was among the products that the ABS flagged are causing higher prices in the food basket, while favourable growing conditions helped with lower fresh produce prices. Interest rate and FX: Inflation and employment data released in June was weaker than expected, prompting several other banks to join RaboResearch in forecasting an RBA rate cut this month. July will also see the expiry of the 90-day pause on US “reciprocal” tariffs. Oil and freight: The Israel-Iran war caused June to be the most volatile month for crude oil prices since October 2023, but prices finished slightly below where they started the month, and the supply outlook ahead remains very strong.

Download the full report

Australia agribusiness monthly July 2025

Previous editions

Australia agribusiness monthly June 2025
Australia agribusiness monthly - May 2025
Australia agribusiness monthly April 2025
More about

Disclaimer

This publication is for information purposes only. The contents of this publication are general in nature and do not take into account your personal objectives, financial situation or needs. Read more