VIC Market Update – 9/3/2018

Giles Ditchfield, Agfarm Regional Manager Vic

 

The Victorian markets have again continued to firm over the last week, as we are seeing strong demand from both the domestic and export markets. There is minimal rainfall on the 8-day BOM forecast, and although it is still too early, we aren’t far off requiring a nice break to get the season rolling. Growers may be feeling very cautious as to what this season will bring after reviewing the Australian Bureau of Meteorology outlook for autumn.

Because of this we have seen the new crop number continuing to be well bid with both fixed and floating multigrades available. New crop fixed spreads are +$30/MT H1, +$12/MT H2, less $10/MT ASW1, less $25/MT AGP1 and less $40 SFW1/MT. We have seen growers committing sales at these numbers, with their feedback being that if this is their worse sale they make all year then they are doing well.

Delivered markets are continuing to be well bid into Central Victoria, delivered Melbourne and delivered Geelong as the buyers look to gain cover. We saw ASW1 delivered Bendigo start the week at $265/MT for March, but this is now back $2/MT as the buyers have managed to cover off their half March position. The same can be said for F1 delivered Melbourne, where we have seen the number back to $271/MT from $275/MT, and the delivered period now being pushed out to March/April. The prompt demand has seen some strong interest with H2 delivered Melbourne and ASW1 delivered Pakenham continuing to be well bid at $295/MT and $283/MT respectively.

Due to the seasonal conditions and long-term forecast, we have seen more grain being held back from the market at the moment as growers are wanting to see another $5-10/MT on the bids. We are seeing more grain being feed to livestock in recent weeks on the back of the dry conditions, with this expected to continue in the short term.

Feed barley has remained steady over the past week. We have seen some strong numbers being bid exfarm and delivered throughout central Victoria, however the track number continues to be trading around $257-258/MT. There are multiple buyers consistently chasing F1, which should make the barley to be well bid in the short term. In saying this, the malt spread hasn’t moved much in the last week due to the fact that the demand isn’t as strong, and as a result of this we should continue to see this spread narrow.

Canola markets have remained flat to slightly down this week after lasts week’s rise. We have seen both the delivered and track numbers back to $506/MT delivered Footscray for March for non-GM and $486/MT for GM canola, as well as a $503/MT track which is reflective of offshore futures and a lean shipping stem. The majority of canola exports this year have been to Europe, with a further 64,000MT booked to South Africa in March. We could see the market competition heat up again as an outcome of this buyer interest, which in turn would be a positive on the market.

Prices as at 9th March 2018

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