Grain prices have rallied this week as growers ingest the impact of widespread rain across south-eastern Australia, and conflict raging between Iranian and US-Israeli forces.
While rain would normally prompt a flush of grain sales to growers keen to backload from port with urea, the Middle East conflict has put a stop to bookings being taken for the top-dressing fertiliser.
Growers are nervous about price hikes and supply of urea once Middle East exports resume, and about pricing and availability for diesel for winter-crop planting, which will start in earnest next month.
Barley price leapfrogs wheat
Barley has overtaken wheat on values this week as on-farm supplies run low in Queensland, and northern NSW growers dole out limited amounts to satisfy the domestic market.
“Consumers big and small are looking for barley,” one trader said.
However, most growers are holding out for stronger pricing.
“In northern NSW, the grower wants $330-$340 a tonne on-farm.”
Barley delivered Downs has traded at $360/t or more in the past week to demonstrate the level of hand-to-mouth buying by consumers.
“Nearby markets are well bid, and the July market is well bid for consumptive demand and from the trade,” another trader said of barley.
Export demand for ASW-type wheat out of Brisbane and Newcastle remains thin.
“All markets are lacking a bit of liquidity.”
Further stymieing traded volume is uncertainty about fuel prices, a knock-on from conflict centred in Iran, and its impact on road-freight rates.
Traders have told Grain Central that price hikes being seen at diesel bowsers indicate 10 percent could be added to the benchmark long-haul price for grain, currently at an indicative $35/t for a 300km run into Brisbane.
As one transport operator told Grain Central, this may be hard to pass on to the grain trade amid fierce competition for business in a quiet year for haulage that reflects limited winter-crop exports out of Brisbane to date.
Very little rain fell in the past week over Qld and northern NSW grain-growing areas, but the forecast points to at least 25mm by late next week for most districts.
Qld’s western Downs and Maranoa, as well as Central Qld, are forecast to get 50mm or more in the coming week, with the CQ falls ideal for its recently planted sorghum and mungbeans, and to set up for winter-crop planting.
In its quarterly Australian Crop Report out Tuesday, ABARES left its forecast for the Qld sorghum crop at 1.68 million tonnes, and cut the NSW forecast from 890,000t to 840,000t.
The southern Qld and northern NSW sorghum harvest is close to finished.
Rain soaks parts of south
In the week to 9am today, patchy rain fell in central and southern NSW.
Higher registrations included: Condobolin 25mm; Cowra 104mm; Deniliquin 60mm; Forbes and West Wyalong 67mm; Grenfell 117mm, Temora and Young 54mm, and Wagga Wagga 37mm.
In Victoria, higher Mallee registrations included: Mildura 151mm; Ouyen 104mm, and Sea Lake 180mm.
In the Wimmera, Horsham on 160mm topped the readings, while Dimboola got 82mm, Rupanyup 96mm, and Warracknabeal 99mm.
Such heavy rain in February-early March is unusual for Vic and southern NSW, and would normally spark a run of urea orders aimed at top-dressing once canola and cereal crops are established.
However, the Middle East conflict has put a stop to new fertiliser business as importers and wholesalers wait for the situation around currently suspended shipping through the Strait of Hormuz to clarify.
“You can’t buy urea anywhere at the minute,” Peters Commodities Wagga-based trader Peter Gerhardy said.
In the south as well as the north, grower selling of 2025-26 cereals and pulses stored on farm remains thin, and is counter to what would normally happen after a rain event, when growers would look to sell a load or two of grain and backload with urea.
“The grower is no hurry to get rid of stored stuff, and there are huge concerns with fuel supply and urea costs ahead of sowing.”
“Yes, the rain was great, but now we’ve got added headaches about the inputs for the next crop.”
Mr Gerhardy said mixed farmers who have had good rain in the past week were sowing vetch, rye and oats to get some feed going for late autumn into winter.
He said livestock was looking even better in the light of expected price hikes for urea, once it becomes available, and diesel.
“These added costs are going to make livestock even more attractive.”