SOLID demand from feedlots has seen barley trade sideways in the past week, while the low-protein wheat market has softened in response to subdued export demand.

Aside from the tail end of the sorghum harvest in New South Wales and southern Queensland, grain is mostly being executed out of bulk storages, and export trading activity is switching to higher wheat grades.

Softer values for SFW and ASW-type wheat are attracting some solid buying from domestic consumers as farmers across Australia advance winter-crop planting in mostly ideal conditions.

	Today	Apr 27
Barley Downs	$430	$430
SFW wheat Downs	$412	$415
Sorghum Downs	$405	$418
Barley Melbourne	$360	$360
ASW Melbourne	$405	$410
SFW Melbourne	$395	$405

Table 1: Indicative prices in Australian dollars per tonne.

Limited grower selling in north

Growers across southern Queensland and northern NSW have generally planted 20-30 percent of intended winter-crop area in mostly ideal conditions.

On the southern Liverpool Plains and parts of the Darling Downs, they are concurrently harvesting the last of their sorghum and also picking cotton.

Quest Commodities Gunnedah-based principal Jane Barker said barley was in “fairly tight supply”, and Liverpool Plains end users were sourcing most of their barley from the Central West of NSW due to a shortage of closer supplies.

Ms Barker said demand from feedlots sticking with barley, coupled with tight stocks, were expected to support prices ahead of new crop.

“I don’t see much downside until we get into September-October,” Ms Barker said.

SFW wheat remains in ample supply, and some in the trade are calling it $20/t above export parity.

Therefore, consumers can only see downside amid mostly favourable Northern Hemisphere conditions, and a sizeable carryout in NSW, mostly in traders’ hands.

“Most consumers have switched into wheat, where there’s not as much competition from exporters; they’re focused on sorghum and high-grade wheat now.”

“I don’t see a massive supply of SFW on farm or in depots; they sold that earlier, while the going was good.”

Durum in all three grades could be making its way into the market in coming weeks, as traders seem reluctant to accumulate another cargo or two to follow what has already been shipped.

Ms Barker said growers with warehoused durum were likely to sell it into the local stockfeed market if export channels do not open

Growers are upping their selling of H2 and other higher-protein wheat grades, largely for transfer after July 1.

New-crop cottonseed is trickling into the market as ginning gets off to a slow start in northern NSW and southern Qld.

Woodside Commodities managing director Hamish Steele-Park said cottonseed values have drifted lower in the north, but values have held steady in the south.

“The late start has created a premium of $15-20/t in values for May delivery over June forward in northern NSW,” Mr Steele-Park said.

“Export market remains quiet, and US cottonseed is still cheaper than Australian seed on a CFR basis.”

Cottonseed ex gin June-August Moree is trading at $380-385/t, while Namoi Valley cottonseed is more like $370-375/t.

“In the Riverina, seed values are $420-430 June forward ex gin.”

Ginning in the Riverina is expected to start in late May, and the Macquarie Valley gins in north-central NSW are also yet to fire up for the season.

Recent rain has held up defoliation and picking in the Macquarie and Riverina, but both operations are progressing well in northern NSW and southern Qld under mostly clear skies.

On sorghum, the Liverpool Plains harvest, which is the latest in NSW, is around halfway through, and crops are yielding 4-4.5 tonnes per hectare.

As the days get shorter and the weather cools, sorghum is more likely to need drying before it is delivered.

With the market dropping around $20/t in the past week or two, Ms Barker said growers are more likely to hold sorghum to give them time to dry it, and in hope of the market rallying.

“There could be some spikes if people need to fill vessels or trains.”

Shift in southern wheat buying

In the southern market, Pearson’s Grain trader David Munnis said growers were selling a small amount of grain into the market, but volume is not expected until sowing is completed and/or the new financial year.

From Western Australia through to pockets of Victoria, some growers are looking for 10-15mm of rain to replenish topsoil moisture.

“Everybody’s busy on a tractor, and there’s a bit of grower selling here or there, but it’s been full noise with planting since Anzac Day,” Mr Munnis said.

Prompt domestic markets appear to be covered thanks to volume sales of on-farm grain in the lead-up to planting.

“There’s been a lot of grower selling to get trucks into the right place, so Geelong and Melbourne, to get fertiliser back to the farm.”

Mr Munnis echoed Ms Barker’s observations in that the trade is shifting its interest from ASW and SFW-type wheat to APW-H2, with H2 trading at around $420/t delivered Melbourne, and export the focus.

 

Grain Central: Get our free news straight to your inbox – Click here