Sam Davidson, Agfarm Account Manager VIC
This week saw Vic wheat cash markets trade mostly sideways with choppy up and down sessions that failed to see a sustained break higher. Buyer interest for system stock appeared to shift from Melbourne and Geelong port zones to Portland as exporters commence accumulating for April – June export programs. Market bid/offer was a touch asymmetric this week with offers +$5/MT over failing to connect. Grower market sentiment continued its positive trajectory with very few sellers communicating concerns of downside risk. Buyers on the other hand attempted to calmly and cautiously cover short positions and where the market permitted, walk the bid lower.
Delivered buyer markets on the other hand finished firmer with slow grower selling and firm track markets all supporting gains. Attention now turns to open demand for March delivery with solid buyer interest for feed wheat delivered to both the Western Districts and Melbourne/Geelong zones.
Feed barley markets continued its move higher this week however the momentum is starting to slow with track market bids gaining $3-4/MT over the past two weeks. F1 delivered Melbourne/Geelong remains well bid however prompt demand looks to have been filled with buyers now looking for delivery from the second half of March to June.
Malt barley premiums remain unchanged with Scope and Latrobe holding at +$15/MT over feed one barley throughout the Melbourne and Geelong port zones this week. Although spreads failed to lose ground week on week, we haven’t seen any indication of premiums firming. Recent price gains can be attributed to feed barley demand leaving growers pondering when Malt buyers will step back into the market.
Canola markets really are the pits this season and understandably it’s a hot topic for growers this week with yet another month gone and sloth like changes in cash markets. Well supplied global markets, a very thin Australian export program and lethargic demand from domestic crush plants are all applying pressure. Grower selling appears to spike at $501-505/MT MEL/GEL track capping market rallies at these levels. Although bullish influences remain elusive over the short term we are looking at drier conditions throughout the East Coast which might see some feedlotter, poultry and swine demand for crush meal price into current crop markets. Offshore futures markets are also slowly recovering which can’t hurt, neither could a somewhat weaker AUD. All of the above could see cash markets recover, you never know.
Prices as at 23rd Feb 2018