WHEAT and barley markets have firmed in the past week as consumers book small amounts at prices above export parity.

On sorghum, the up-country market has fallen on supply-side pressure as harvest gathers pace, but the Brisbane container market is trading at a premium to reflect demand from China.

Logistics are also factoring into prices, with northbound road freight hard to book as trucks focus on taking bulk grain and containers to port, and southern trucks deliver grain to port and backload with fertiliser.

	This week	Last week	Change
Barley Downs March	$282	$276	Up
Barley Melbourne March	$260	$260	Steady
Wheat Downs March	$315	$308	Up
Wheat Melbourne March	$312	$310	Up
Sorghum Downs March-April	$295	$330	Down

Table 1: Indicative prices in AUD per tonne.

Trucks busy

In northern Victoria, Pearson’s Group trader Reagan Stroud said grower concerns about a shortage of fertiliser had prompted an early start to runs to port to bring a backload home ahead of planting winter crop.

“That interest in backloading fertiliser is probably a month earlier than normal,” Mr Stroud said.

Sources have described the southern market as quiet, with traders mostly executing parcels of grain into export slots as vessels load at a cracking pace at South Australia and Victorian ports.

Major feedmillers are believed to be mostly covered into April or May, but smaller operators are booking truckloads here and there with growers, or through grower-brokers.

“The direct market is feeding that.”

Demand from southern Queensland feedlots has been slim.

“Barley was working out of Nyngan, but that market’s firmed up a few bucks, and to draw it up here now you’ve got to pay $290/t,” another source said.

“We’re better off buying out of bulk sites that are closer to us, or just bringing in what we’ve already booked.”

Rangebound for now

Delta Grain Marketing general manager Mick Parry said any surprises in the USDA’s Prospective Planting report could push local wheat and barley values out of their levels of recent weeks.

“It’s really quietened down here; there’s been a lot of volatility in the US, but not in the Australian market.

“We’ve been trading in a $10/t range for weeks, and we’re waiting for some new news.”

That could well come from ideas about the size of the corn crop US farmers will grow over their summer.

Mr Parry said strength in canola and chickpea markets has caught the attention of growers wanting to some tonnage for cash in recent weeks, though not much canola remains in growers’ hands.

“Barley enjoyed a $25-$30 rally from its 10 December harvest low…to mid-January, and it’s been steady to a little lower over the past four weeks.

“Wheat is very strongly supported by export.”

Mr Parry said growers have squirrelled away considerable amounts of barley in readiness for the next dry spell, but most have some volume to quit if prices appeal.

“Growers are holding more barley than they’d like to be.”

Brisbane heat for sorghum

In the sorghum market, the delivered container terminal (DCT) market in Brisbane is trading well above export parity for feedgrains, with trade to China for baijiu production the driver.

“On Monday, the Brisbane DCT bids were in the mid $350s, and now their back to the mid $340s.

“It’s come down because people are unwinding their track positions, and the Chinese New Year has seen things go quiet on the demand side.”

Small amounts of sorghum from the harvest now well under way are pricing into poultry and pig rations, but are mostly being delivered to container packers as full boxes start to flow to port.

“Freight is focussing on sorghum,” one trade source said.

The on-farm market for sorghum is sitting at around $300/t Narrabri and $310-$315/t Darling Downs, which supports a Brisbane DCT price of $360/t.

Consumers on the Downs are generally bidding less than $300/t for sorghum, which indicates that they are not prepared to switch out of barley or wheat any time soon.

Carpendale Commodities trader Chris Coore said the Brisbane sorghum market looked solid for the next few months, a welcome change from last year.

“Between April and May last year in Brisbane, there was a $110 discount.

“We’re not seeing that this year, which indicates there’s enough sorghum to go around.

“The biggest problem is executing it.”

Mr Coore said the northern market was showing signs of a small amount of pent-up demand from smaller operators for barley for delivery next month.

“People would buy more if they could get the trucks to move it.”

In its latest Australian crop report released on Tuesday, ABARES forecast the area planted to grain sorghum to have increased by 21 to 511,000 hectares, 258 per cent higher than the area planted last summer.

Production is forecast to increase by 409pc to 1.5 million tonnes (Mt), comprising 130,000ha producing 514,000t in New South Wales, and 380,000ha producing 1Mt in Queensland.

 

 

 

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