Nathan Michael, Agfarm Account Manager SNSW

We are now two weeks into the new year and we are finally seeing buyers and sellers on the same page. Buyers are putting out bids with the intention of buying, and sellers are making enquiries with the intention of selling. As a result, the market has become far more liquid. Wheat prices in the system have lifted on average $5-10/MT across almost all grades and the increased values have prompted a flurry of selling; given we’re drawing ever closer to the date when most would have to start paying warehousing fees (usually the end of January). F1 Barley has firmed off the back of strong feedlot demand and several parcels have traded at $230/MT site ($270-275/MT PKE). Canola prices are still in the doldrums at $470-480/MT site ($520-525/MT PKE) which is just not in anyone’s selling range.

As mentioned, wheat system stock has increased in price by approximately $5-$10/MT across the board. The number of buyers chasing APW has dramatically increased, and has dragged some of the other grades up with it. APW is now trading at $292-$296/MT PKE, which is in the selling zones of many that missed the high levels during early December. H2 is also trading at a $10-$15/MT premium over this value, which is giving growers reason to consider selling before the end of the month. Exfarm prices have not really moved in line with the track market and growers are still receiving around $250/MT delivered into Riverina feed markets, or $230-245/MT exfarm with grain starting to move north again. With continued price enquiry from northern buyers, it is expected wheat prices will remain firm and possibly increase as the demand for grain into Queensland feed markets shows no sign of weakening.

This week has seen barley markets show some increasing signs of life; system sales went through at around $272-275/MT PKE track, putting it around $6-7/MT above generic numbers. The exfarm and/or delivered markets also increased with Western Riverina now trading at around $255-260/MT delivered January-April. Eastern Riverina markets have seen business slightly higher at around $260-265/MT delivered consumer January-April and Southern Riverina (Berrigan/Tocumwal/Deniliquin) exfarm sales have been going through at around $230+/MT which is likely to move north. With the barley supply and demand likely to be very tight all year long, offers will be paramount but as we stand now we are starting to get into top 10-20% of historical values.

It was good to see canola numbers remained steady this week. Some sales going through have been to export-type counterparties rather than domestic consumers which will take a little away for now, but time will tell if it is actually for a boat or not. Values continue to generically be sitting at around $510/MT PKE track, with some sites up around the low $520’s/MT PKE track. If prices get closer to $500/MT site we would see more sales of what is currently stored in warehouse, which would keep further rises at bay. Internationally, the next USDA report is out tonight (Friday 12th) which will give some short-term direction. All reports suggest soybeans are okay in Brazil and there is likelihood of a good plant in the US this year (barring conditions between now and planting), so any upside potential may not come from this front for now.

Prices as at Friday 12th January 2018

 SNSW pricing tables 20180112

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