A crop of LRPB Beaufort wheat showing the benefits of recent rain in Victoria and South Australia. Photo: Western AG.

 

WHEAT and barley prices have eased in the past week in response to rain across the entire Australian grainbelt, and grower willingness to meet the market.

This has seen a tail-off in drought demand from those with livestock, as well as finished feed manufacturers.

Buffering the price falls has been a drop overnight in the Australian dollar.

The Australian Grains Industry Conference is on in Melbourne this week, with many in the trade busy in sessions and associated meetings.

Among the talk outside AGIC sessions is that plenty of feed wheat and barley is still held in bunkers, silos, and sheds, and will find difficulty pricing itself into international markets with the big Northern Hemisphere rolling in.

Table 1: Indicative prices in Australian dollars per tonne.

Northern growers bite the bullet

Ahead of what is looking more and more like another above-average crop in the north, Knight Commodities Goondiwindi-based broker Gerard Doherty said current-crop grain is being sold as growers accept current bids to move volume.

“The shoe is back on the buyer’s foot,” Mr Doherty said.

Recent rain will help to keep early crops up into Central Queensland green, and Mr Doherty said consumers were aware of needing to be covered well into spring.

“The headers will be delayed a bit longer than they think.”

It means new crop is not expected in volume before October.

“The trade is still filling holes for August and September.”

Mr Doherty said any further price drops will likely see growers put the brakes on sales of grain warehoused or stored on farm.

“Growers will go quiet, and the market will kick $4-$5/t; that’s been the pattern for months.”

Southern stocks unwind

In Victoria, Watsons Bulk Logistics managing director Joel Watson said rain has brought growers to the market to reduce their carry-out into new crop.

As hopes build about pastures bouncing out of the ground come spring, Mr Watson said demand for feedgrain has thinned considerably.

Consumers are also well covered.

“Buyers have short-term cover and are happy to let prices fall away.”

Mr Watson said recent rain has been substantial, but much still rides on spring weather.

“It is a shot in the arm; it hasn’t made the season, but it has saved a season.”

Mr Watson said growers were likely to sell stored grain when and if the season consolidates.

“As rain comes, they’ll let old-crop go.”