Alistair Murphy, Agfarm Account Manager CNSW
The year has started relatively slowly in Central NSW with a lot of the industry still on leave from the Christmas break. Coarse grain markets haven’t deviated too much over the last two weeks, as international futures have been traded in a relatively tight range. Delivered feed wheat and barley have firmed slightly since the last time we looked at things, this is mainly due to the distinct lack of liquidity in these markets. Track wheat has been weakening slightly since before Christmas because there is still some selling in the Port Kembla region which is providing short-term liquidity so to keep milling demand ticking over. Rainfall wise, there has been nothing significant to report over the last few days, and with temperatures starting to consistently average the high 30oC, the sorghum crop will need further rainfall to maintain current crop expectations.
Chick peas have seen a big fall over the Christmas break, and this is all Subcontinent driven. India announced a 30% import tariff on pulses, so any additional business will be slugged with that hefty cost. Traditionally though, this time of year has been known for bringing a lull in pulse pricing as India’s chick pea harvest normally kicks off in February. Any spot business completed now will typically see an execution time frame of about six weeks to destination, right about the time in which the Subcontinent is powering through harvest, should the logistics processes run smoothly.
There has been consistent buying demand this week for onfarm feed wheat and barley. The trend in feed pricing may be erratic, as buyers appear to once again adopt the hand-to-mouth strategy, paying up where they need to get coverage in the short term. It seems some consumers have decent levels of coverage for quarter one of 2018, and in the absence of grower selling in feed grains, it would be safe to assume consumers with sufficient levels of coverage have done so by sourcing this from the trade. This hand-to-mouth will most likely continue in the early stages of 2018 in the absence of any international value jumps. It will be interesting to see how the feed complex dynamic changes as time progresses into February.
Prices as at Friday 5th January 2018