Ag News

Massive Grain Logistics Operation to the Rescue - by GrainPro

  • By: Farm Tender "Prime"
  • Sep 22, 2017

Australian Growers “Not Selling”. Growers are holding on to old & new crop in fear of massive shortages affecting up to 70% of Australian cropping areas.
 
With the Australian dollar still strong for the time being, freight differentials are now creating “Cost Parities” for feed imports. Additionally with the growing demand from drought stricken Northern regions, Southern grain is migrating North (as you would expect).
 
This should see a “Sharp” increase in delivered grain next week and moving toward harvest into Melbourne. We expect that delivered old crop Wheat (ASW) will be well above $300+ and Barley (FB1) around $285+ delivered Melbourne Range. Security of supply will be a major factor for Victorian feed manufacturers, mills and retailers and should see buyers looking for longer delivery periods through to December 17 and beyond.
 
Imports to the Rescue
Canola Meal & Soybean Meal are scheduled to land by EOY providing some welcomed relief and supply security for Australian animal feed manufacturers in Northern regions.
 
The growing demand from the North for Southern Australian grain has triggered a massive logistical operation sending ships into Northern ports (I would hope this is not just about cashing in on the misfortunes of Northern Australian Growers, and to soften the hardship I would like to see some majors “Donate” feed grain into these markets as a show of leadership and goodwill... Please!)
 
Back to reality
This logistical exercise is an opportunistic move for major storage houses as it helps deplete reserved Southern carry-over stocks in preparation for 17/18 harvest and of course it helps improve the bottom-line for future potential  mergers or sales.. oops!
 
** In light of the comments above I would strongly urge “Grain Grower Associations & Farmer Support Groups to prepare feed security programs and for those more fortunate to donate if you are able.