By Warren Lander - AWB
Well what a week we have had. Life is starting to get back to normal again. Kids back to school, pubs and restaurants opening up, footy just about to kick off and most growers have a grin from ear to ear and full of optimism. Life just doesn’t get much better than this.
With the majority of the eastern seaboard sowing now finished, the attention now turns to forward sales of new crop. We have not seen a full moisture profile at the end of sowing since 2016, and if the stars align and we enjoy timely rainfall, an above average crop is well and truly on the cards. Current new crop pricing is quite solid with new crop APW M/G wheat in the Port Kembla / Newcastle zones this week repeatedly $310-$315/mt track equalling back to a site price $265-$275/mt depending on site location and competition of buyers. This I understand is not the magical $300/mt which a lot of growers are waiting for but if it’s the worst price you receive this year that’s mouth-watering and if it’s the best it is still a great result.
As for barley there is hope since China’s bombshell and a $50/mt fall. New crop pricing has crawled back to a more normal pre-drought level of $188-$195/mt site pricing through the Central West this week. Yes, it’s not great but that is approx. $10-$15/mt site price increase in a fortnight and delivered bids now available into the Griffith region are $205-$215/mt for January/February 2021 delivery. Combine this with potential Saudi demand as we are currently priced into that market, a new trade agreement with India, and the expanding market for feed grain into Indonesia, there are some faint positives in the barley market.
Don’t forget, whoever takes the Australian market to China will leave an opening for exportable sales into their markets. Add to this the low AUD, and a potential rebound is very much a possibility, so all is not lost regardless of what mainstream media is saying.
As for canola, reports have mentioned that a prolonged dry spell is taking place in Northern Europe and Russia which resulted in an increase to pricing of , which then kicked canola futures to a two month high. This allowed Newcastle and Port Kembla pricing to climb to $604 track which, with a large eastern seaboard crop on the cards shows excellent value. But, with it still a long way to harvest it is understandable why many growers are very hesitant to forward sell and that may not be a bad thing either as more demand for canola seed could potentially increase prices. This will come mainly from Europe due to low supply per the drier conditions, higher crude oil prices, and once again the lower AUD.
There are plenty of ifs, buts and maybe’s here but the East Coast is in a pretty handy position at present to capitalise on a promising season ahead.