Sam Davidson, Agfarm Account Manager VIC
This week we’ve seen a low front generating a cloud band and isolated thunderstorms with widespread light falls across most of Victoria and south eastern South Australia. Just enough rain fell throughout the Victorian cropping belt to at least relieve some pressure this week but follow up falls over the next two weeks will determine if further forecast production cuts are required for both cereal and oilseed crops.
Victorian cereal and oilseed markets continued their rally off the back of low selling liquidity and forecast production cuts throughout New South Wales, Victoria and South Australian cropping regions. The 2017/18 season wheat market structure stayed bid orientated week with offers sitting at anywhere from +$5-10/MT over bids. Most buyers are not keen to get out in front of this rally by matching offers over their published price but have moved bids anywhere from $3-5/MT higher each day to keep pace with offers.
ASW1/SFW1 delivered buyer Griffith for AUG/SEP 2018 gained $80/MT over a four week period, moving from $330/MT to $410/MT. This market appears to have chewed through most of SNSW stock and is now drawing from central and southern Victorian regions. This pressured both central and southern Victorian millers and feed lotters to lift prices to keep wheat stocks locally. For example, we saw SFW1/SFWR delivered Western Districts moving $73/MT higher from $317/MT last month to $390/MT this week.
Canola markets have undertaken a remarkable recovery this month with gains sitting anywhere from $50-60/MT. The majority of buyers for both old and new crop remain domestic crushers whose concern over next year’s production rises day by day. We saw a $600/MT bid for canola delivered buyer Melbourne Nov/Dec this week, however unsold growers are happy to sit on the fence for the time being and watch for further upside.
Photo: Canola crop in Maryborough VIC
Prices as at 9th August