It’s decision time for lot feeders and domestic grain buyers again as a new wheat and barley harvest looms.
Buyers are weighing up the options of buying new crop cover now, or waiting to pick up harvest grain and buying hand to mouth.
As usual these decisions are never clear cut as we look at the risks versus the rewards, and the result is plenty of uncertainty as we roll toward the new harvest.
Some key factors which are impacting our markets domestically are drier and warmer conditions in north west New South Wales and on Queensland’s western downs, where the crop needs a drink and growers are reporting rapid yield reductions.
This also causes growers to refrain from forward selling old and new crop until there is more certainty of rain.
Overhanging this is the ongoing risk of frost. The warmer than average winter to date means there are now crops out in head, and a hard frost now would be a real issue for crops that are already suffering from potentially poor yields.
On the flip side, the remaining parts of the wheat and barley belts along the east coast are shaping up to produce bumper crops with excellent yields expected at this point.
Reports from Western Australia also suggest a fair crop thanks to average rainfall and no real dramas.
Southern grain markets are languishing due to a lack of demand from buyers with sufficient old crop and good new crop prospects, while the northern markets are strong on lack of old crop stocks and concerns over new crop harvest.
New crop sorghum for March 2014 is also ticking along trading at $268/t, up $20 from last month, this needs to be watched as the feed grain complex digests the possibilities of Chinese demand again and the potential to export feed grain away from domestic buyers.
Cotton is also shaping up well as an alternative for growers in 2014. The bale price has hit $500, which is considered the magic number for growers to plant.
Current markets for wheat delivered Downs are trading at $316 and new crop November harvest slot at $300, January to June trading at $310 plus carries, Barley not really trading old crop, with new crop January $288 plus carries to June. September Sorghum delivered Downs $300 with containers of sorghum still been exported, new crop sorghum Downs March 14 $268. Cotton Seed September delivered downs $360 and new crop cotton seed April 2014 $260. Liverpool plains wheat September trading at $295 with limited buying from consumers. Victorian buyers waiting and watching new crop numbers although there are export numbers trading for wheat at $285 del Melbourne while domestic consumers are watching a big crop get bigger.
- 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