Our domestic grain market is yet again proving to be an interesting beast, with influences such as drought, currency and export demand all making price movements challenging to predict.
The sorghum market has been hot to trot with China already buying about 38pc of our 2.2 million metric tonne Australian Sorghum crop, or 850,000 m/t. This will be exported in bulk shipments and in containers, with the bulk of the demand for stockfeed.
The sorghum export program to China is expected to run from March to July this year.
Chinese demand for sorghum in recent months has been mind blowing, with the US also exporting up to 7 million tonnes to China in the past six to seven months.
This is predominantly new business for the US and they will looking to sell into China again this year when the US sorghum harvest starts July-August, (which is why our Aussie demand is only up to July). Currently new crop US sorghum is priced at $25 cheaper then Australian sorghum.
China have also been buying Australian Barley and have bought up to four million tonnes of our barley this year, the bulk from Western Australia and South Australia. There has also been a significant increase of exported tonnes to China with an increase from the previous few years of over 50pc.
It is hard to see China slowing down as it has to feed its 1.3 billion-strong population and it first needs to feed livestock.
The wheat market has also fired up in the past few weeks on the East Coast as well, with the drier conditions restricting grower selling. Central NSW wheat has been trucked to Queensland feedlots although this is getting difficult to source with export demand from southern states.
Downs sorghum for April is priced at $298/t, feed wheat $324 and barley $314 delivered Feedlots. Liverpool Plains wheat is $298 landed with not much trading. Riverina wheat delivered is $275 and barley $265. Goulburn Valley wheat delivered $285 and barley $275 for barley landed.
- Prices quoted in this column are of an indicative nature only to illustrate trends and do not represent a definitive buy or sell price at a given point in time. For specific prices for your region contact the author at email@example.com or (07) 4659 0755 or twitter @lukergtgrain