WHEAT and barley prices have softened in the southern market this week, while barley rates in the north have firmed to reflect limited supply.
Some sell-side pressure on wheat is being seen in the northern market as growers make room for corn and sorghum soon to be harvested, and supply-side pressure in the south appears to be coming from the trade and not the grower.
Harvest is fast coming to a close in all states bar Tasmania, where the headers have gotten going in the past week or two.
|SFW wheat Downs||$395||$400|
Table 1: Indicative prices in Australian dollars per tonne.
Northern wheat sags
Patchy rain has boosted yield prospects for sorghum and corn crops in parts of northern New South Wales and southern Queensland in the past week.
Registrations for the week to 9am today in NSW include: Dubbo 27mm; Dunedoo 90mm; Moree 4mm; Mungindi 7mm; Quirindi 19mm; Walgett 12mm, and Warialda 29mm.
In Queensland, registrations include: Kingaroy 21mm; Macalister 3mm; Dalby 5mm; Oakey 42mm; Roma 11mm, and Surat 47mm.
At Armidale, Broun & Co director Charlie Coventry said consumers were still coming to terms with the lower-than-expected incidence of feed-grade wheat out of harvest, and forward coverage for many consumers was limited.
“There are still plenty of consumers that don’t have a lot of cover on; the great majority have only got cover into the end of February or March,” Mr Coventry said.
Mr Coventry estimates only around one quarter of the northern NSW wheat harvest was downgraded to feed.
“That’s made up of SFW, GP, Feed and AH9, and SFW might be only 10pc of the whole wheat crop.”
With the sorghum and corn harvests not far away, Mr Coventry said some growers were selling wheat held in on-farm storages to make room for summer-crop grain.
“There’s a reasonable flow coming from growers in the north, and there’s more wheat than barley.”
Trade sources report barley trade is thin, based on more loads making malting specifications than growers expected.
“In the northern part of the state, some growers were really excited to get malt for the first time ever.
“They sold that early, which was the right thing to do.”
“That’s taken a greater amount of barley out of the feed bucket.”
Mr Coventry said prices were not low enough to spark volume buying from consumers, and dry conditions in the north and their impact on sorghum and corn yields could hold them up for some time yet.
“Prices are at a level that’s not compelling for them to get coverage, and it’s drier in the north and summer crops are being impacted; rain is needed to salvage yields.”
Another trader said demand from feedlots particularly was outstripping supply.
“A lot of people are not trading barley, and people are wanting to trade wheat now to make room for sorghum,” the source said.
Export sorghum business has slowed to a crawl because of Chinese New Year, with many offices closed into next week for the celebration.
Grower selling slow in south
Harvest has finished for many growers in south-west Victoria and south-eastern South Australia this week, and trade sources report grower selling is unusually thin for this time of year.
“They’re sitting on their hands a bit, but you’ve got to keep it in perspective that growers are running a month late.”
The delayed harvest is to blame, and it has got the 2023 farming calendar off to a slow start.
“The grower is reasonably comfortable on what he or she has sold, and they are prepared to sit out until February or March.
“Fertiliser inquiry is just starting to fire up now, and it’s probably running two months later than normal.
“A lot of the growers might buy fertiliser in late November and in December, but because of harvest being so late, they finished that and they’re trying to sneak in a quick holiday.”
Mr Gerhardy said domestic consumers appeared to be reasonably well covered.
“The trade’s probably the one that may need a bit of cover on.”
As with the north, SFW wheat is not as prevalent as the trade and consumers were expecting when rain and cool weather were thwarting the crop’s finish and harvest.
“Everyone thought there was going to be SFW for miles; it’s not near the volume everyone thought.
“A lot of the downgrading was on bushel weight, not falling numbers.”
That pushed some loads into H2 and H9 segregations at better prices than SFW.
“There’s not a lot of barley; it could end up being a little bit tight.
“There’s definitely barley about, but not in volume.”
Shipping stems out of Victoria and NSW remain focused heavily on wheat, with barley shorts yet to appear based on positions into domestic or export homes.
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