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New Zealand's milk production in August 2022 was down 4.9% compared to the previous year, resulting in a decrease in milk supply. However, beef exports remained strong, with export volumes increasing by 13% year-on-year. Demand from China, Japan, and Korea supported the farmgate schedule, while demand from the US remained soft due to ample supplies of lean trimmings. The beef pricing schedule is expected to remain elevated in the coming months, supported by a favourable exchange rate and strong demand from China. Consumers are starting to show resistance to high prices, leading to a shift towards lower-value cuts and proteins. New Zealand's milk production for the month of August was the lowest in five years, resulting in a decrease in milk supply for the season. Lower imports from China and reduced purchasing activity have stabilized Oceania commodity prices. While the Chinese market continues to show a decline in import volumes, other importers are taking advantage of lower prices. The local supply, ample inventories, and soft consumer demand are contributing to reduced import purchasing. However, the attention remains on New Zealand's milk supply as the seasonal peak hits its stride. The Baltic Panamax index, a proxy for grain bulk freight, rebounded in September, supported by strong volumes from South America. The OPEC+ meeting in September resulted in a supply cut, and further cuts are likely in the upcoming meeting.

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Australian agricultural commodity prices have experienced a downward trend, with beef, dairy, and grain prices all being affected. The decline in prices comes despite favourable seasonal conditions but can be attributed to elevated input costs and rising interest rates globally. While input costs have stabilized for now, the fertiliser index saw a 7.5% increase in August, posing a challenge for producers. Additionally, the formation of a third consecutive La Nina event, with a 70% chance, could further impact agricultural conditions. The dairy sector has seen a decline in global trade auction results, but farmgate prices remain strong due to competition among processors for milk. However, there is a risk of margin squeeze for processors in the coming months. Grain prices have been influenced by higher interest rates and global recession fears, causing fluctuations. Extreme weather events in key growing regions and the potential for a La Nina event have added pressure to the global supply picture. Australian grain prices have been relatively stable compared to international spikes, and favourable seasonal conditions are expected to lead to an above-average crop. Beef prices experienced a crash in June and July but have rebounded recently. Although seasonal conditions remain supportive, a weaker global growth outlook and high input costs have affected sentiment. Lamb prices have been falling, and the market may experience downward pressure with the upcoming spring flush. The wool market has seen flat to lower prices after a decline in the price run-up. Overall, prices for beef and lamb remain historically high, although the recent decline in prices has surpassed expectations.

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The spring outlook for beef demand and farmgate pricing in New Zealand is positive, with tight global beef supplies and strong demand from China and the US. The AgriHQ North Island bull price has increased, and farmers can make trading decisions with confidence. However, labour shortages and processing challenges have led to lower beef export volumes, and the US cow herd liquidation is affecting demand for New Zealand lean trimmings. Overall, the beef market is expected to remain elevated, but cost headwinds and production risks should be considered. Commodity prices for dairy products have continued to decline, influenced by inflation concerns, recession fears, and doubts about global economic growth. Milk production in New Zealand has decreased, impacted by a dry autumn period in Waikato and fickle weather conditions. Global milk production is also struggling, with sluggish growth in the EU due to adverse seasonal conditions and feed shortages. The Chinese dairy market remains uncertain, with restrictions and economic softening. Despite these challenges, dairy prices are supported by elevated prices in export regions and strong demand from China and the US. Russian fertiliser exports, including potash, are expected to remain strong despite a slight decrease year-on-year. Phosphate prices are projected to trend down due to larger supplies in North and South America. Agrochemical prices in China have already declined due to production capacity expansion, although energy shortages may slow the rate of decline. Oil markets globally remain tight, and crude oil prices have been affected by economic outlook and demand factors. Ocean container and bulk shipping rates are experiencing fluctuations due to global economic conditions and supply chain issues.

The Bureau of Meteorology (BOM) has raised the La Niña alert with a 70% chance of La Niña developing this spring in Australia. The outlook predicts above-average rainfall for most of Northern, Central, and Eastern Australia, which is favourable for beef production. However, below-average rainfall conditions are expected in Western Australia and western Tasmania. The cattle market saw a correction in prices in August, with cattle prices dropping and opportunistic traders re-entering the market. Saleyard numbers were low, indicating strong producer demand and the expectation of sustained strong prices. The Oceania dairy commodity complex, including Australia, experienced falling prices in August, with declines in milk powders leading the way. China's import demand has slowed, impacting global dairy demand signals. Australia's milk supply also declined in the 2022/23 season due to industry consolidation and unfavourable weather conditions. Rising dairy prices in retail and foodservice channels, along with cost-of-living pressures, have hampered end-user demand in price-sensitive emerging economies. The New Zealand spring peak is expected to bring more milk this season, which will influence the global market balance and commodity price direction. The grain market has seen volatility in prices, influenced by various factors. The Indian Ocean Dipole (IOD) has moved negative, increasing the chances of above-average winter-spring rainfall in Australia. Soil moisture is above average in many parts of the country, with flood risks remaining for Eastern Australia. CBOT wheat, corn, and soybeans prices finished mixed in August, influenced by dryness in the US, EU, and China. Rabobank has marginally downgraded its CBOT wheat price forecast but still expects prices to remain above average due to below-average global stocks. Canadian and Australian crops are expected to contribute to large canola harvests, affecting prices and exports.

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The Bureau of Meteorology (BOM) predicts above-average rainfall for most parts of Australia this winter, except for Western Australia and western Tasmania, which are expected to have average or below-average rainfall. The BOM's seasonal outlook also indicates a high chance of exceeding median rainfall on the east coast between August and November, which could benefit crop growth. However, the increased rainfall also poses a risk of flooding. Cattle prices have been declining, with many now below year-ago prices, leading to reduced buying activity. Slaughter numbers are slowly increasing, but processing capacity constraints persist. The Oceania dairy commodity complex experienced mixed results in July, with cheese prices showing the smallest declines, while milk powder and butter prices fell by around 10%. Milk supply in Australia and New Zealand has been affected by poor weather conditions, leading to decreased production. China's dairy market faces challenges, including elevated inventories and concerns about demand. Farmgate milk prices in Australia remain at record levels, providing some stability for dairy businesses despite global uncertainties. Rabobank expects above-average global grain prices, with CBOT wheat prices forecasted to trade within a certain range over the next 12 months. However, Ukraine's grain exports faced disruptions due to geopolitical tensions with Russia. In Australia, the winter crop area is expected to be slightly lower than the previous year, with reductions in NSW and Queensland due to excessive rain and waterlogging. The harvest season may bring downward pressure on prices due to a large crop, significant on-farm grain volumes, and congested port zones from the previous year. The nitrogen and Agri-chemical markets are influenced by factors such as gas prices, supply and demand issues, and changes in pricing for key ingredients.

New Zealand's beef exports faced a decline in demand from the US market due to lower US demand caused by the liquidation of the US cow herd and ample supplies of 90CL cow. However, exports to China remained strong, surpassing the five-year average export volume. Despite the challenges, farmgate pricing for beef remained elevated, supported by tight global beef supplies and a favourable exchange rate. New Zealand's dairy industry experienced a decline in exports to China, with a 30% YoY decrease in the first half of the year. The reduction was attributed to weaker Chinese demand due to COVID-related lockdowns and increased local milk production. However, milk production in New Zealand remained steady, with a slight increase in June compared to the previous year. Despite the export challenges, farmgate pricing for dairy products remained elevated. Global urea markets experienced falling prices, reaching 11-month lows in July. However, signs indicate that supply and demand issues will push prices higher in the coming months. The global container rate index declined, but rates are expected to normalize over the next 12 months, remaining higher than pre-pandemic levels due to various factors such as imbalanced trade flows and increased operational costs. The Baltic Panamax index, representing grain bulk freight, continued to decrease, and the resumption of grain exports from Russia and Ukraine via the Black Sea remained uncertain.