SORGHUM prices have dropped $20 per tonne in the past fortnight to a level low enough to spark widespread demand from the poultry and pork sectors in the northern market.
This has further reduced consumer interest in booking wheat and barley, despite grower readiness to sell.
In the southern market, export demand from feed-type wheat from The Philippines in particularly is supporting ASW prices, as China continues to go big on barley
As with the north, southern consumers are largely out of the market on adequate coverage.
|ASW wheat Downs
|ASW wheat Melbourne
Table 1: Indicative prices in Australian dollars per tonne.
Northern consumers sit out
Traders report a very quiet January, as poultry and pig producers position themselves to consume sorghum at maximum inclusion rates once new-crop volume ramps up.
Feedlots are gearing up to switch from wheat to barley once the weather cools down, and are seen as adequately covered for some months.
“Most feedlots have really good grain coverage from January to June,” one trader said.
“There’s a lack of demand domestically for the first half of the year.”
Exports out of Queensland are largely confined to containerised H2 wheat, with lower grades unable to compete on price against Black Sea and southern Australia.
Growers are keen to sell some warehoused and on-farm wheat and barley, but spot demand is limited, and is not expected to pick up before mid-year.
“Cattle on feed dropped towards the end of last year, but they’ll start to pick up as we move into March-April.
“Even the trade guys are saying they can’t sell to the consumer.
“Growers are looking to sell more wheat and barley to make room for the sorghum harvest, and they would sell at these levels if they could find a home.”
Production prospects for the sorghum crop have improved markedly in the past week or two, with some substantial falls from northern New South Wales to Central Qld.
Qld registrations in the week to 9am today include: Clermont 82mm; Dalby 95mm; Emerald 74mm; Hannaford 134mm; Jondaryan 70mm; Miles 61mm; St George 118mm, and Springsure 107mm.
While some districts missed the rain, those in CQ that got good falls are planting sorghum now at the ideal time, and most crops in southern Qld as well as northern NSW have had good rain in recent weeks.
Rainfall from the system which brought Tropical Cyclone Kirrily to North Qld last week tracked north of CQ, and has been of benefit to grazing districts.
Improved prospects for sorghum yields and area have minimised demand from the poultry and pig sectors for white grain.
“Their coverage has extended out to new crop.”
Southern values flat
Growers in Victoria and southern NSW are turning their minds to the planting of new crop, which will start with early oats in March and ramp up with canola and lentils in April ahead of the main cereal window in May.
With good subsoil moisture in most districts growers will be looking to sell a few loads of grain stored on-farm to backload with fertiliser.
“The markets seems a bit flat, although there’s a bit of activity into packers with APW and ASW wheat,” Peters Commodities Riverina-based trader Peter Gerhardy said.
APW is priced around $20/t above ASW, reflecting the extent of lower-protein wheat delivered in the harvest just gone.
Accumulation of barley, mostly to China, and of wheat, primarily for South-east Asian destinations, is keeping volume to port flowing.
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