Agfarm Market Update – Central NSW: 12/02/18

Domestic coarse grain values firmed across the board last week, following a series of consecutive gains in international futures toward the end of the week.

Photo: Supplied

Photo: Supplied

This brought on increased levels of sell activity from growers, though predominantly more so in southern cropping zones within Port Kembla and Victoria where production has been more favourable this year.

Barley continues to be in hot demand, as buyers are finding it very hard to locate replacement stock in traditional northern market drawing zones.

As such they have had to look further afield into Southern NSW to acquire tonnes.

It’s not coming cheap either, as the southern feed markets have also increased bids to sure up supply in an attempt to stop too much of it heading north.

Feed wheat markets have also firmed, but there is a noticeable level of buyer bias towards barley as this is the commodity in tightest supply.

Growers revised sown barley acres noticeably back this year, as values at seeding time were extremely low. Combine this with very poor yields and it starts to paint the picture as to why buyers are finding it so hard to source.

We have saw SFW1 bids in the range of $270-275/MT exfarm Central NSW last week, with barley bids/trades firmer in the range of $275-$280/MT.

Even with upside we are not seeing a great deal of wheat sale commitments being made onfarm into the feed markets. This is mainly due to most grades harvested this year being H2 or better, of which local packers and millers have been paying a premium for.

While not a lot of feed wheat style APW1 and ASW1 was produced this year, there are growers who have opted to carry over some of the previous seasons ASW1 / AGP1 stock onfarm.

This will prove to be useful once the feed wheat balance sheets start to tighten towards the middle of the year.

There is still a premium spread for H2 over the feed market of about $10/MT, but as time passes we would expect this premium to dissipate in the coming months once specific milling demand reaches a comfortable level of cover.

Chick peas softened a little again last week, settling slightly above the $600/MT range delivered packer Central.

Though we haven’t seen too much enquiry from the sell side for pulses at present. Growers thoughts are with yields way back this year and the international market being off last year’s highs, which could mean sowing seed for the 2018-19 season may be a little bit hard to source.

This could potentially provide a premium in the planting market in the lead up to sowing, but time will tell if a premium does indeed eventuate in this market.