PROGRESS in the Queensland harvest has softened values in the northern market, while moves in southern prices were mixed and moderate to reflect some short covering and the inevitability of big volumes of feed grades in ongoing wet conditions.
New South Wales roads closed by the worsening flood situation in parts of the grainbelt are the biggest logistics hurdle for the trade this week.
However, trade sources report some dry and even sunny weather has allowed trucks to load.
The lateness of the eastern and South Australian harvests could well see some exporters provide additional competition for old-crop grain as shipping moves to the new-crop window with nothing fresh off the header to be found south of the Queensland-NSW border.
|Prompt||Oct 27||Jan-Feb||Oct 27|
|SFW wheat Downs||$412||$425||$415||$415|
Table 1: Indicative prices in Australian dollars per tonne.
North makes progress
Harvest of barley and wheat crops is taking place in the drier patches of Central Queensland (CQ), the Maranoa, the Western Downs and the border region.
However, many places remain too wet to start or resume harvest after patchy falls in the past week which included: Clermont 3 millimetres; Dalby 3mm; Macalister 33mm; Miles 37mm; Roma 42mm, and Springsure 52mm.
Growers on the southern side of the NSW-Queensland border are starting to have a nibble at harvest, but progress is still at least a fortnight away in most parts of NSW.
Rain across the state has been patchy, and very heavy in places.
Highest registrations include: Coonabarabran 91mm; Coonamble 46mm; Gunnedah 39mm; Narrabri 33mm; Pallamallawa 36mm; Parkes 43mm; Quirindi 80mm, and Warialda 41mm.
However, the biggest falls for NSW occurred in the catchments of major dams, and included 95mm at Crookwell in the Lachlan Valley headwaters and more than 200mm in the Snowy Mountains, which will make its way into the Murray River on the NSW-Victorian border.
All rivers in inland NSW are already in flood, and the situation is unlikely to change for weeks and possibly months.
In northern NSW, Stewart Grain trader Robert Quinn said sprouting is evident as grain that has copped considerable rain just prior to harvest starts to hit the market.
The result is a further widening of the spread between milling and feed, with the feed market softening.
“Last week there was a bit of panic with still a lot of roads shut, and the grain’s not there in the south yet,” Mr Quinn said.
While trucks can load from selected sites and get to where they need to go, it is via a circuitous route in NSW.
“Everything’s a challenge.”
That includes news this week that wet weather has thwarted ARTC plans to reopen the Moree-Narrabri line this week as initially scheduled following a shutdown over winter for Inland Rail works.
Robinson Grain wheat trader Jock Benham said growers were reluctant sellers, and with good reason.
“Growers are going to wait and see what they’ve got; no-one’s committing to quality.”
He said this was keeping market attention on previously bought loads.
“A lot of people are still trying to execute nearby.”
That remains a problem, with some major highways, including the Newell near Forbes, closed as the Lachlan peaks.
“If anyone’s got APW to H2 as milling grades, they’ll get a good premium.
“We’ve started running out of areas with prospects for good-quality milling wheat.”
Mr Benham said some consumers are chasing an extra fortnight or so of coverage to compensate for the lateness of harvest.
“Some people are hand to mouth at the moment.”
Damp and sprouted
While the standard moisture limit for wheat is 12.5 per cent, most deliveries are coming in at more like 13.5pc.
“Most people in that mid-tier market have lifted their specs to accommodate that moisture, but you’ll start to see grain come in within the usual specs soon,” Mr Quinn said.
The dreaded “shot and sprung” has reared its head at sample stands to reflect sprouting, but testweights are holding up.
“The stuff that’s lying on the ground in floodwater might be a different story.
“Most of the stuff coming in is SFW1.
“If you’ve got ASW, there’s a really big spread between it and feed.”
Early indications are that what the wheat crop lacks in quality, it will make up for in yield, with reports of 5 tonnes per hectare or better common.
One trade source said Queensland growers are willing sellers of barley in order to clear their decks for a big wheat crop.
“The market knows full well a lot of feed wheat is coming off in this harvest, and growers are thinking better than $380 is good for new-crop barley.”
Another trader said milling grades of wheat are up $10-$20/t in the past week, with H2 about the best grade to be found in volume in CQ and the Maranoa so far.
“Last Friday, it was $490 track Brisbane; today it’s $510,” he said yesterday.
“In CQ and western areas, most crops are ripe, but it’s a matter of when they’ll be able to get on the country.
“It’s wet out there.”
Slow in south
In Victoria, the northern Mallee and southern Wimmera had some unwanted heavy falls, but most of the southern Mallee and northern Wimmera had a maximum 10mm.
Registrations for the week include: Dimboola 11mm; Goroke 43mm; Horsham 12mm; Nhill 12mm; Ouyen 27mm; St Arnaud 27mm, and Swan Hill 20mm.
Much of the SA grainbelt got enough rain to force a pause in escalating harvest activity, with higher registrations including: Clare 65mm; Darke Peak 32mm; Kadina 33mm; Kimba 31mm; Melrose 83mm, and Orroroo 60mm.
GeoCommodities broker Brad Knight said trade is extremely thin based on an absence of grower selling.
“In the nearby, there are people still scrambling for access to stock, and until we see what the crop looks like, there won’t be much volume.”
While only a couple of dollars separates prompt barley and SFW prices in the northern market, feed wheat is trading at a big premium to southern barley markets, and milling grades are now at a big premium to feed wheat.
“The market’s done the work with the spreads already, but it’s trading in such small volumes it’s hard to draw much from it.”
While new-crop barley from the NSW Riverina and northern Victoria is usually hitting the bins by Melbourne Cup Day, which this year occurred on November 1, wet conditions and green crops have a mid-November start looking likely.
“We’re not going to see barley for another two weeks.
“There’s a bit of nibble now going on in the harvest…but it’s still too wet for most people to get going.”
Mr Knight said Victorian wheat quality could still come in at ASW or better, but downgrading was a very real possibility.
“If there was no rain between now and when harvest finishes, quality might be OK; any rain we get from here on in, it’s going to be more of a challenge.”
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