The latest USDA update forecast global grain production slightly higher this month driven by an increase in production for Ethiopia partially offsetting reductions for Argentina, the European Union, and Saudi Arabia.
Global trade declined due to reduced exports from Argentina, Brazil, and the EU offsetting greater Black Sea exports which continue to flow at competitive prices and an extension of the Black Sea Grain Initiative.
Imports are forecast lower due to reductions from Indonesia and many countries in Asia and South America.
The three-month outlook from May to July indicates the chance of exceeding median rainfall is between 20 to 30 per cent (pc) across almost all regions of Australia, after favourable rainfall in April. Above average rainfall in April was experienced in key cropping regions such as the Wimmera-Mallee, Riverina, Eyre Peninsula and the central and south regions of Western Australia.
From the field
Western Australia
"Seeding is well underway in WA with a large proportion of canola and lupins already in the ground. The focus for May will quickly move to the cereal part of the program.
“With warm moist conditions it has been ideal in many areas for a good germination. This has also brought issues with a range of pests hatching. This year we have even seen Red Legged Earth Mites (RLEM) hatch which is concerning for many growers as they look to protect newly emerged canola crops.
“For many areas in WA it has been the ideal start with a good spread of rain, and this has provided some early sowing windows and good germination of weeds on other paddocks. With the warm autumn days, this moisture is not long lasting so the challenge will be to retain as much as possible to allow the cereals to be sown in their preferred window.”
Bill Moore, Elders Technical Services Manager, Western Australia.
South Australia
Yorke Peninsula
“April rainfall saw good weed germinations, providing the opportunity for effective knockdowns which has not happened in recent years. With good subsoil moisture in many places, and much of the Yorke Peninsula receiving 10 to 30 mm of rain during the last week of April, growers are beginning to ease into seeding this week. For some, the decision to start is made difficult where the seedbed remains dry despite recent rainfall.
“Although mice activity is evident in some paddocks, the issue is not currently widespread, and where baiting and other management tactics have been employed in recent months, snail control has been good.
“The biggest challenge for the region over the next month will be simply navigating the logistics of seeding, with a wet start adding pressure to control weeds and use double knocks where possible.”
Brianna Schaefer, YP AG Agronomist, Yorke Peninsula.
Adelaide Plains
“We’ve had patchy rain throughout April and early May. Southern Adelaide Plains, Roseworthy and the south have had decent rains. We’ve had a good germination in most areas of the lower north. Surprisingly, there is a huge amount of ryegrass already germinated.
“Sowing has started off slowly with most farmers only really getting into it this week. Top soil moisture is a challenge for parts of my area. We are unlikely to get a good germination in some areas but have plenty of moisture underneath from last season.
“Mice and snails tend to be the biggest threat but no more than previous years. Farmers have already had some slug damage on a new crop of lucerne.
“The main challenges are seed cleaners running behind time and high stubble loads from last year which means more burning off. This has been hard due to patchy weather and not being able to get a permit as grapes in the area haven’t been picked and vineyards are worried about smoke taint.
“Spare parts have been difficult to get quickly; some farmers are still waiting over a week for product out of Sydney.”
Craig Prior, Elders Agronomist, Roseworthy.
Weather is driving prices
Nathan Cattle from Clear Grain Exchange shares his thoughts on the current grain market and what’s been happening on the exchange.
The northern hemisphere crop entered their spring with some large question marks.
Global grain stocks are tight, winter crops in the US and other parts of the world were not in great shape coming out of dormancy, and Russia remains unpredictable.
However, weather conditions over recent weeks have generally been favourable in many areas of the northern hemisphere, helping their winter crops and fuelling expectations of large spring crop plantings.
This has seen grain prices grind lower and the market will require some significant news to push values the other way. Which is very possible given we’re in the northern hemisphere spring. While escalating conflict in the Black Sea maybe an example of an event that could change the direction of markets to the upside given the reliance on Russian supplies.
Hence, we watch the weather forecasts with the rest of the global grain market.
The offshore price direction has weighed on Australian prices as export margins tighten.
Despite this there remains good appetite to purchase grain that buyers can make work. Right grade, in the right location and growers are a good chance of getting their grain sold.
Creating more reason to have your grain offered for sale. So, buyers can search for it, crunch their numbers and try to buy it.
On a more positive note, a more liquid container market has seen prices for minor crops such as oats and pulses improve considerably in recent months.
Oats and lupin prices have traded over $350/t in Kwinana, lentils have been $850/t and faba beans $400/t in mainland South Australia, while chickpeas have fetched $600/t Brisbane.
There are plenty of buyers that want Australian grain - more than 100 have bought grain through CGX this season, over 300 are registered to buy your grain.
By offering your grain for sale on Clear Grain Exchange you make it easier for every buyer to see your grain and try to buy it - that's a good thing, because we want as many buyers as possible trying to buy your grain.
You're always protected by anonymity and secure settlement. All you need to do is decide what price you want for your grain - the rest is looked after for you!
Regardless of what grain you have in warehouse or whether you want to sell in the near-term or are prepared to target higher prices and potentially hold grain for longer; get it on offer so all buyers can see it and try to buy it.
Market indicators
"I sell wheat and barley through CGX and usually achieve above the market value as advertised in the current market."
Jeff Burgess, grain grower, Gulnare, South Australia.
Learn more about Jeff's experience with Clear Grain Exchange.
The information contained in this article is given for the purpose of providing general information only, and while Elders has exercised reasonable care, skill and diligence in its preparation, many factors (including environmental and seasonal) can impact its accuracy and currency. Accordingly, the information should not be relied upon under any circumstances and Elders assumes no liability for any loss consequently suffered. If you would like to speak to someone for tailored advice relating to any of the matters referred to in this article, please contact Elders.