Local Market Update

 

  • The cereal harvest is near its end, with just a few later sown crops to come in. In general, yields and quality have been good, with some areas well above the expected average.
  • Farmers are now contemplating what to plant for the coming season. As contracts for grass seed crops have been severely cut, more ground may be pushed toward cereal crops.
  • Demand from the dairy sector is uncertain but has the potential to increase. As predicted milk price is on the rise, producers may be pushed to chase production through supplement feeding, which may have more affect in the spring.
  • PKE spot is sitting around $370/t ex store.
  • Industry buyers are cautious around both prompt and spread pricing for 2024 grain.

 

Ruralco is always looking for grain to supply a wide range of end users. If you have free or uncontracted grain that you would like to sell, please contact the Ruralco Seed team. Drop your sample at any Ruralco Store, contact your Ruralco Representative, or call the Ruralco Customer Service Centre on 0800 787 256 to arrange sample bags or pick up. For queries about free or uncontracted grain that you would like to sell please contact the Ruralco Seed Team or request a call back below.

Content updated as at 7 March 2024.

 

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Canterbury Growers Pricing Per Tonne*

*Nominal pricing, indicative only & subject to change.

 

Import Pricing Per Tonne*

*Pricing at 7 March 2024.

Meet Our Experts

 

John Scott

SEED SALES MANAGER

@: John.Scott@ruralco.co.nz
Ph: 027 227 7048

 

Ricky Brown

Ricky Brown

ARABLE & PASTORAL REPRESENTATIVE

@: ricky.brown@ruralco.co.nz
Ph: 027 554 3009

 

 

Steve Lawson

Steve Lawson

ARABLE & PASTORAL REPRESENTATIVE

@: steve.lawson@ruralco.co.nz
Ph: 027 245 5661

Australian Update

 

Feedgrain Focus: Markets flat as sorghum ramps up

Source: Written by Liz Wells for Grain Central

 

Grower selling has slowed to a trickle as prices sink for wheat and barley flatline in the south and ease further in the north.

Trade sources report contracts booked up to three months ago are being executed to keep grain flowing through the system, but new export and domestic business is thin.

In the south, growers are hopeful the barley price will rally when Chinese buying comes out of its current lull, and that wheat prices will firm once shipping of Black Sea and Western Australian wheat slows.

In the north, sorghum harvesting is gathering pace and early loads are going mostly to domestic consumers.

 

Northern sorghum

Trade in the northern market remains extremely quiet, with feedlots well covered into the next quarter, and the poultry and pig sectors waiting for new-crop volume to hit the bins before they advance coverage.

China’s hectic buying pace on Australian sorghum appears to have slowed, and trade sources say any new-crop loads trading into Brisbane are mostly going to consumers rather than export accumulators.

Depot bids are around $325/t on the Darling Downs, just high enough to catch some grower selling.

Rainfall in southern and Central Queensland in the week to 9am today includes: Clermont and Springsure 7mm; Dalby 11mm; Emerald 17mm, and Macalister 19mm.

The rain has been very patchy, and welcomed by those with mungbeans, cotton and late sorghum in the ground.

It is also topping up moisture profiles ahead of winter-crop planting, which will start in Qld in April.

On cottonseed, Woodside Commodities managing director Hamish Steele-Park said values remain rangebound.

“Domestic buyers have been standing aside in the market,” Mr Steele-Park said.

“There is some export interest at $540/t DCT, which is keeping values steady.”

After old crop being at a large premium to new crop for most of last year, Mr Steele-Park said the price inverse between old-crop and new-crop cottonseed has narrowed to evens.

New crop ex gin is now priced around Moree at $420/t, Namoi Valley at $415/t, Murrumbidgee gin $425/t and Macquarie Valley $420/t basis gin spread 2024.

Domestic consumers of cottonseed are also sitting out of the market on the idea of strengthening supply from the pick which will start next month and gather pace over autumn.

“There’s talk that the cotton crop is getting a bit bigger due to dryland yield potential, and it seems most estimates range from 4.8 to 5 million bales.”

 

South slow

In the southern market, grower offers are up to $20-$30/t over market bids.

“It’s generally pretty dead; growers aren’t overly keen to engage at these levels.” Peters Commodities Riverina-based trader Peter Gerhardy said.

“You might get the odd guy pushing some out for fertiliser, but in general, growers are content to sit on their hands.”

Another southern trader said prices have fallen to levels where the grower has disengaged.

“Growers are starting to pull up on selling at $300/t ex farm for wheat, and maybe slightly lower,” the trader said.

Market talk says fertiliser prices will ease between now and June, so growers are showing interest in selling grain mid-year to backload with urea for top-dressing.

Most have covered their planting requirements for fertiliser with earlier cash sales and are in no rush to sell more before June.

“We’ve had a little bit of grower selling inquiry for post June.”

“On barley, I think they’re holding on to stocks knowing China has been buying, and hoping the barley price gets up to where wheat is.”

While much of south-eastern Australia is in the midst of a heatwave, growers generally have enough subsoil moisture to only need a top-up rain prior to the opening in April of the main planting window for winter crops.

Feed Wheat Comparison

 

 

Feed Barley Comparison

 

World Market Update

Source: International Grains Council

 

Highlights

The estimate for world total grains (wheat and coarse grains) production in 2023/24 is 3m t higher m/m (month-on-month), almost entirely because of an upward revision for maize. Including increases for maize industrial use and feeding, the forecast for grains consumption is also lifted by 3m t but with tighter opening inventories, the end-2023/24 carryover (aggregate of respective local marketing years) is trimmed by 1m, to 589m.

Wheat supply and demand projections for 2024/25 are broadly similar to those issued last month, albeit with a slightly tighter stocks outlook, now seen at an eight-year low. Next season's maize harvested area is seen a touch higher y/y (year-on-year), but with divergent trends in the main growers. Barley acreage is expected to be smaller than average, little-changed from the season before.

Largely linked to a downgraded figure for Brazil, world soyabean production in 2023/24 is lowered by 1m t from before, but still a record and 5% higher y/y. Outlooks for total use and stocks are also trimmed, but with each seen rising solidly y/y. Traded volumes are predicted unchanged m/m, at 168m t (-2%). In preliminary projections for 2024/25, world harvested area is placed at a new peak of 140m ha (+2%), chiefly on gains in leading exporters.

The Council’s expectations for rice supply and demand in 2023/24 are broadly unchanged m/m. While the forecast for end-season carryovers is uprated slightly from before, the overall picture is unaltered, with world stocks set to tighten y/y. Looking ahead to 2024/25, global harvested area is provisionally projected to edge up to a new high on gains in Asia and Africa.

The IGC Grains and Oilseeds Index (GOI) dropped to its lowest since October 2020, down by 7% m/m.

Global total grains (wheat and coarse grains) production is forecast to increase by 43m t in 2023/24, to a record 2,310m, as a much larger maize harvest (+71m y/y) more than compensates for declines for some other crops, including wheat (-15m) and barley (-8m). With uptake at a new all-time high, world closing stocks are expected to tighten again, dropping for a seventh year in a row, to 589m t (-7m). Trade is placed 9m t lower y/y, at 419m, including smaller wheat, maize and barley shipments.

Mainly reflecting a rebound in production in Argentina, more than compensating for falls in the US and Brazil, global soyabean output is forecast at a record of 391m t (+5%). Underpinned by an upswing in processing in the three majors, world utilisation is seen advancing to a new peak, while further stock accumulation is anticipated. With purchases by China and Argentina likely to be scaled back, trade is predicted to contract by 2% y/y. On a local MY basis, Brazilian shipments could drop by 8m t y/y.

World rice output is forecast to contract slightly in 2023/24 on smaller harvests in Asia’s leading producers – including in India, linked back to the fallout from a disappointing monsoon season. Against the backdrop of reduced supplies, global rice use is seen falling by 1% y/y, while stocks are set to tighten despite a modest uplift in major exporters’ reserves. Trade is projected to fall for a second successive year in 2024 (Jan/Dec), to around 50m t (-3%). Despite a sizeable drop in volumes, India will remain the biggest rice exporter.

With dry peas production holding steady and consumption expected to advance solidly (+11%), including sizeable gains in India, global carryovers are forecast to tighten in 2023/24. World trade is seen remaining above the recent average in 2024 (Jan/Dec), at 6.1m t (-2%), including modestly smaller deliveries to China. Canadian exports are predicted to contract by 10% y/y as shipments by Russia hold firm.

 

Market Summary

Including solid declines in average maize, soyabean and wheat export prices, the IGC GOI retreated by 7% compared to the January report.

The IGC GOI wheat sub-Index weakened by 5% overall, pressured by comfortable nearby supplies and limited international demand.

Amid broad losses across all origins and with regular, competitively-priced offers from Ukraine, the IGC GOI maize sub-Index slumped by 14%, to a more than three-year low.

The IGC GOI rice-sub Index was little-changed m/m, with losses in Thailand and Vietnam balanced by net gains in India.

Linked to building South American seasonal pressure and overall routine export demand, the IGC GOI soyabeans sub-Index dropped by a net 9%.

 
 
 

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