Australian Update
Feedgrain Focus: Rain-related downgrading sinks values. Liz Wells, 12 December 2024. Source: Grain Central
Values for feed wheat and barley have fallen in the past week as domestic consumers see little to no export competition for downgraded cereals.
Reluctance from southern growers to sell rain-affected cereals has tempered the fall, while in the north, some time pressure is upon growers ahead of the sorghum harvest which will start in earnest around New Year.
Cereals are also having trouble muscling into nearby shipping stems for eastern Australian ports, where pulses and canola have blocked out most nearby slots.
Sorghum pressure coming
Wheat and barley bids from the stockfeed market have fallen in the past week to reflect the growing proportion of unharvested grain which is weather damaged, and thin export interest in either grade.
In the Brisbane port zone, that is tied to the focus on bulk cargoes rolling straight from chickpeas into a big sorghum program in February, with little room for wheat.
One trader said consumers were already well covered into February, and are expecting growers to sell cereals stored on farm by the end of January to make room for sorghum.
Growers looking to sell feed barley and ASW-type wheat are finding limited buying interest, even after some minor logistics disruptions tied to rain in the past week.
“Homes are scarce; a lot of consumers are covered into February,” the trader said.
Quality of northern NSW and southern Qld new-crop wheat is said to be predominantly ASW and APW, to reflect above-average in-crop rainfall for much of the crop and low protein as a result.
Any export interest in boxes or bulk out of southern Qld looks like being in H2.
Recent rain caught only a small amount of the overall wheat crop in the north, mostly on the inner southern Downs, and on the Liverpool Plains of NSW.
Falling numbers machines are out in force at grain sites across southern Australia.
“There will be SFW around…because of weather damage.”
Central Qld has well and truly finished its wheat and chickpea harvest.
CQ growers will plant sorghum in January and February, and falls in the past week including 19mm at Clermont, 16mm at Emerald, and 50mm at Springsure will help to top up the soil-moisture profile.
In southern Qld, rainfall in the week to 9am today included: Dalby 23mm; Felton 41mm; Jondaryan 46mm, and Miles 18mm.
Cotton has also benefited significantly from recent rain, and estimates have the crop to be picked in autumn at at least 5 million bales.
Ginning of the current crop has finished, and Woodside Commodities managing director Hamish Steele-Park said values have dropped $10/t over the past couple of weeks.
“Export demand is lacking, and there’s only intermittent buying interest from domestic feedlots on both current crop and new crop,” Mr Steele-Park said.
Prompt current-crop values are sitting at around $385-$395/t against $420/t ex Riverina gin.
“US cottonseed values remain cheaper than Australian seed on CFR basis Asian markets Dec 24- Jan 25 delivery
New-crop ex gin values are lower than current-crop values, being around $405/t ex Riverina, $38/t ex Moree, and $370/t ex Namoi Valley.
“There’s not much transacting as sellers’ and buyers’ ideas vary considerably.
“With a gin shutdown typical from Christmas to early to mid-January, the seed market can be quiet over this period.”
South escapes mass downgrades
Parts of central and southern NSW received some heavy falls in the week to today, and registrations include: Condobolin 61mm; Cowra 66mm; Dubbo 44mm; Parkes 55mm; Temora 22mm, and Young 32mm.
However, many locations where harvest is still under way had a dry week.
In Victoria, rain was more general, but light, and 15mm at Nhill and Rupanyup among the higher registrations.
At Tocumwal, Kelly Grains principal Matt Kelly said the impact of recent rain on wheat does not appear to be as widespread as initially feared, with only around 25 percent of samples failing the 300-second falling number test.
“We’ve got a variety of grades coming off, and around a quarter are non milling; we were expecting 75pc,” Mr Kelly said, adding that only about 12pc was dropping down to the GP grade.
Most of the region’s barley has been harvested before the rain, and Mr Kelly said roughly 70pc of that had made malting specs.
Barley caught by the rain is all now going into feed, and is destined for local sheep and cattle feedlots, including a number of Wagyu yards.
“Post rain, all has been downgraded to BAR1, and there are some slightly low testweights going into BAR2.”
Mr Kelly said feed barley should attract plenty of local interest.
“Even the sheep guys that were using red wheat are now using barley and corn, which we grow around here over the summer.”
Strong demand for prompt-shipment No. 1 faba beans means stockfeed mills cannot compete with export values being offered to growers in the Tocumwal region.
Unlike many crops in the Wimmera, southern NSW fabas were generally harvested ahead of the rain.
“They’re all export quality, so they’ll be going out in a box or bulk.”