Australia: Dry south lifts prices

Wheat, barley and sorghum has traded steady to higher in the past week as dry conditions across southern Australia tighten near-term supply amid ongoing export demand.

In the northern market, patchy rain and high grain-moisture levels are making for a slow end to the sorghum harvest as growers switch attention to planting wheat in mostly ideal conditions.

Across much of Western Australia, South Australia, Victoria and southern New South Wales, growers are anxiously waiting on rain to germinate dry sown crops.

A lack of pasture in those areas has also rekindled grazier and mixed-farming demand for grain to support livestock as the first frosts start to hit.

Table 1: Indicative prices in Australian dollars per tonne.

Growers across southern Qld and northern NSW are flat out planting main-season wheat, while Central Qld growers have made a start on chickpeas.

Some are also harvesting the last of their sorghum, which is slow in getting to market.

“Quality is quite good, but there’s a lot of wet sorghum that was stripped at 13.7 or 14 percent moisture; that’s inhibiting trading,” Stewart Grain trader Robert Quinn said.

Higher-moisture sorghum is trading at a $15/t discount, and is being blended with drier product at receival sites to meet out-turn specs.

Consumer demand for wheat, barley and sorghum remains modest.

With the northern region’s production prospects currently looking much more solid than the south’s, consumers are said to be in no hurry to buy.

Buoyant export demand has supported prices for prompt and new-crop wheat and barley in southern markets, and new-crop multigrade wheat has traded at $400/t.

“We have seen an increase in wheat selling, both delivered and in-store at the start of this week off the back of some rain and increased prices,” one trader said.

While Vic, much of SA and southern NSW has good subsoil moisture, topsoil in many areas is dry, and some growers have paused their planting programs as they wait for substantial rain to appear on the forecast.

“We’re going through a bit of a dry time,” Peters Commodities Riverina-based trader Peter Gerhardy said.

“A few guys have pulled up with sowing.

“There are a lot of crops sown that are up but haven’t had any rain since.

“That means with grazing varieties, they’re not high enough to put sheep on.”

Mr Gerhardy said crops that have missed out on a rain to bed the crop down since planting cannot yet be used for winter feed for fear of sheep pulling the whole plant out of the ground.

“Some growers are starting to feed stock now when they didn’t think they’d have to.”

“We want rain; there’s no doubt about it.”

Mr Gerhardy said some graziers and mixed farmers were looking for a load or two of wheat, barley or lupins to feed livestock ahead of dual-purpose cereals and canola being ready to graze.

Others who might have otherwise sold a load or two in recent weeks are feeding it out to their own sheep instead.

While trade-to-trade sales have been hitting the higher values seen in recent weeks, grower selling is not expected to make a comeback until the new financial year starts on July 1, or widespread rain falls to improve new-crop prospects.

Sowing of the Australian winter crop is in its final third, and widespread rain by the first week of June is needed to ensure a full planting and average yield potential.

Tags: Australia, export, barley, wheat, sorghum, Market, demand