Local Market Update

 

  • Autumn/winter cereal plantings are well through. April's AIMI survey shows farmers' intentions are to reduce the area of cereal to be planted.
  • There has been a slight increase in prompt barley pricing, while pricing for wheat has decreased slightly. However, there has been limited trade in both. Buyers and sellers alike are keenly waiting to see how late winter/early spring environmental conditions unfold.
  • The AIMI survey, taken on 1st of April, has unsold on-farm stocks of wheat up 46% and barley up 6% compared to last year.
  • Limited contracts are out for 2025 Harvest feed wheat, roughly down $50/t on last year.
  • Field Days pricing for PKE is looking to be trading around $325/t ex store for both spot and contract purchases, down about $50/t from the previous week.
  • Industry buyers remain conservative around both prompt and spread pricing for 2024 grain.

 

Ruralco is always looking for grain to supply a wide range of end users. If you have free or uncontracted grain that you would like to sell, please contact the Ruralco Seed team. Drop your sample at any Ruralco Store, contact your Ruralco Representative, or call the Ruralco Customer Service Centre on 0800 787 256 to arrange sample bags or pick up. For queries about free or uncontracted grain that you would like to sell please contact the Ruralco Seed Team or request a call back below.

Content updated as at 17 June 2024.

 

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Canterbury Growers Pricing Per Tonne*

*Nominal pricing, indicative only & subject to change.

 

Import Pricing Per Tonne*

*Pricing at 17 June 2024.

Meet Our Experts

 

John Scott

SEED SALES MANAGER

@: John.Scott@ruralco.co.nz
Ph: 027 227 7048

 

Ricky Brown

Ricky Brown

ARABLE & PASTORAL REPRESENTATIVE

@: ricky.brown@ruralco.co.nz
Ph: 027 554 3009

 

 

Steve Lawson

Steve Lawson

ARABLE & PASTORAL REPRESENTATIVE

@: steve.lawson@ruralco.co.nz
Ph: 027 245 5661

Australian Update

 

Feedgrain Focus: Southern dry boosts local demand

Source: Written by Liz Wells for Grain Central

 

 

Dry conditions in South Australia and western Victoria have boosted demand for feed barley to lift up-country prices above weakening export values.

These have seen values in quoted markets drop this week by roughly $5-$15 per tonne, with the exception being sorghum, which has firmed slightly as the moisture-affected tail of harvest restricts traded volumes.

Some grain accumulated for export out of SA and Vic is being redirected into the domestic market, and on-farm sales are also going locally for a premium to what container packers and port sites are offering.

Feedmills, graziers and mixed farmers are all in the market for far more grain, fodder and pulses than normal at this time of year, but 10-25mm forecast for next week could quickly temper demand.

 

Volume thin in north

A week of mostly dry weather in Queensland and northern New South Wales has allowed grain to be delivered to domestic consumers as scheduled, but the cold spell has done little to speed the tail end of the Darling Downs sorghum harvest.

Nonetheless, loads from farms are being turned out of high-aeration silos and driers, with exporters able to blend up to required specifications from what is being delivered.

Southern Qld consumers are looking further afield for barley now that uncommitted local stocks are down to the wire.

“Sorghum’s very flat, and multigrade sorghum is going into Brisbane,” Knight Commodities Goondiwindi-based broker Gerard Doherty said.

Providing a spike in values for feedgrain in the northern market are peripheral consumers in the North Burnett, Wide Bay and adjacent regions.

“That’s giving us some ex farm values above where the Downs market is.”

Qld consumers are sourcing grain from well into NSW as the thin wheat-export program out of Newcastle starts to tail off and growers in northern NSW take comfort from what looks like it well at worst be an average-yielding year for the crop now in the ground.

 

Southern drought lifts demand

Very dry conditions in high-rainfall grazing and mixed farming areas of SA’s South East and Vic’s Western District have brought unexpected demand into the feed market.

This has seen commercial feedmills and graziers compete for increased amounts of barley, wheat, oats, field peas, and faba beans.

Bulk handlers large and small are taking the unusual step of out-turning truckloads for the domestic market to satisfy demand brought about by an extremely dry autumn.

Many farms in SA and western Vic have had less than one-third their annual average rainfall in the calendar year to date, and some canola and winter cereals that could normally be relied on for grazing now have yet to germinate or establish.

GeoCommodities broker Brad Knight said producers with livestock to feed are looking locally to get a load or two to help them through this dry period.

“Sales are neighbour to neighbour, cousin to cousin, mate of a mate, and then further afield until they can get what they’re after,” Mr Knight said.

“It’s very unseasonal for them to be buying grain this late; normally they’ll buy late summer and early autumn, and to not have had any real rain since then is very rare.”

While large-scale feedmills with multiple blending options are happy to incorporate wheat into their rations, farmer demand is focused on barley.

“It feels like the barley market’s gone into a supply-demand rationing scenario, and it’s trying to discourage exports.

“That market’s been increasing over the past few weeks but what’s happening has been masked by the general market rally.”

While the Melbourne market normally trades at $20-$30/t above the on-farm southern Wimmera market to cover road freight, the premium is more like $15/t, to indicate the on-farm market has lifted on up-country demand.

Prior to southern drought demand kicking in, Australian feed barley was already unattractive to offshore markets when compared with other origins.

“Barley is hard to sell if you’re relying on traditional export markets.”

Up-country wheat values are also getting a kick from drought demand as large-scale feed manufacturers chase it, and pulses too.

“Protein is in strong demand for feed.”

Feed Wheat Comparison

 

 

Feed Barley Comparison

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World Market Update

Source: International Grains Council

 

Highlights

World total grains (wheat and coarse grains) production in 2023/24 is forecast 4m t lower m/m (month-on-month), at 2,297m, mainly reflecting smaller sorghum and barley estimates. While the supply outlook is somewhat cushioned by increased carry-ins, the estimate for carryover stocks (aggregate of respective local marketing years) is cut by 3m t m/m, to 588m. Boosted by larger wheat and maize flows, the forecast for trade is hiked by 8m t from last time.

Including cuts for maize (mainly in Argentina, sub-Saharan Africa) and wheat (Russia, Ukraine, the US), the projection for global grains production in 2024/25 is down by 10m t m/m, to 2,312m, up by 1% y/y (year-on-year). Forecast consumption is trimmed m/m, but with tighter supplies, closing stocks are placed 12m t lower than before, at 580m, a second successive sharp monthly reduction. Maize accounts for most of the 2m t cut to the forecast for global trade, seen at 416m t (-4% y/y).

On the basis of larger than anticipated dispatches to key markets, including China, more recently, the outlook for world soyabean trade in 2023/24 is uprated by 2.0m t m/m. Global output in 2024/25 is projected 1m t higher m/m and, due to higher carry-ins, inventories are raised by about 3m t m/m. Trade is predicted steady m/m, at an all-time peak of 172.2m t (+2%).

Uprated figures for world rice production and total supplies in 2023/24 are channelled to increases for consumption and aggregate stocks. Lifted by 3m t m/m, global rice output in 2024/25 is pegged at a record of 523m (+2%), also feeding through to an upgraded prediction for combined reserves. Trade in 2025 is pegged up slightly from April on higher projections for Asian and African buyers, with much of the m/m gain reflected in upward adjustments for Indian and US exports.

The IGC Grains and Oilseeds Index (GOI) posted solid gains, rising to a four-month peak, led by especially strong advances in wheat prices.

Entirely because of a much larger maize outturn, global total grains production in 2023/24 is forecast to edge higher y/y, to 2,297m t. Despite larger supplies, a relatively sharper increase in consumption, to 2,311m (+2%), will push ending stocks lower, estimated at 588m t (-2%), including tighter wheat inventories (-6%).

Grains output is projected to increase by a further 1% in 2024/25, to 2,312m t. In a reversal to the trends in the season before, maize production is seen lower, but with y/y gains across other commodities. Consumption growth is expected to be fairly tepid, rising by 9m t y/y, to 2,320m, albeit with food, feed and industrial uses seen at new peaks. Closing stocks are pegged at a 10-year low of 580m t (-1%), led by declines for wheat and maize, with exporter inventories at 142m (-3%).

After surging in the prior year, global soyabean trade is projected to edge lower in 2023/24, albeit remaining significantly above average, including sizeable deliveries to key buyers. Global output is predicted to reach a high of 414m t in 2024/25, including heavy outturns in the US, Brazil and Argentina, while an uplift in demand for soya products is set to underpin record processing and total use. Carryovers are seen accumulating further, with much of the increase due to the three major exporters. Trade is anticipated to resume an uptrend, expanding by 2% y/y.

Chiefly linked to a reduction for China, global rice stocks are seen falling by 4m t y/y in 2023/24. Looking ahead to prospects for 2024/25, production is projected at an all-time high (+2%), with increases anticipated in leading exporters, notably in South Asia. Consumption is seen advancing on population gains, while inventories could rise on accumulation in India. Trade is projected to expand marginally in 2025, as shipments to African markets more than offset reduced buying by Asian importers, mainly Indonesia.

Global lentils production is projected to recover in 2024/25 on a bigger crop in Canada, with gains, too, in consumption and stocks. After falling in 2024, global import demand is predicted to edge up in the following year on larger shipments to the Near East. In the Council’s updated outlook, trade in all pulses in 2024 is forecast at 21.2m t, down 5% y/y on softer demand for lentils and broad beans.

 

Market Summary

The IGC GOI soared by 9% m/m. While all constituent commodities gained, advances in wheat, soyabeans and barley were especially marked.

Buoyed by northern hemisphere weather worries, which mainly focused on frost-related production losses in Russia, the IGC GOI wheat sub-Index spiked by 16%, reaching a 7-month peak.

The IGC GOI maize sub-Index was 4% higher m/m, underpinned by supply uncertainties and spillover from wheat. Offers from Ukraine were especially firm, partly boosted by strong export demand.

The IGC GOI rice-sub Index rose by 4%, led by solid gains in Thailand, tied to tightening spot supplies and firmer overseas demand.

Fuelled mainly by heightened worries about production and logistics in southern Brazil, the IGC GOI soyabeans sub-Index advanced by a net 9%.

 
 
 

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