Australia: Prices soften as harvest accelerates

Prices have softened in the past week as harvest winds down in Queensland but cranks up in other states amid mostly ideal conditions.

Domestic consumers have stepped up buying, and are meeting solid competition from export accumulators on wheat and barley.

Consensus on eastern Australia’s grain quality at this early stage is that barley is generally good with surprisingly high test weights, while wheat quality is mixed based on paddock history, variety, time of sowing, and in-crop rain.

Table 1: Indicative prices in Australian dollars per tonne.

Harvest is over for many Queensland growers, even on the later-maturing Inner Downs.

Consensus is sound quality and average yields at best.

In northern New South Wales, some growers are close to finishing harvest, as opposed to this time last year when many were yet to start due to the mild and wet season.

Some light test weights and high screenings are coming through in wheat harvested on paddocks where crown rot has carried from last year.

This off-spec grain is being snapped up primarily by the poultry sector.

Yields for wheat are generally around 2.5 tonnes per hectare, below average but a good result considering how little in-crop rain has fallen.

Cheap road-freight prices, as low as 9 cents per kilometre, are available from carriers getting on the Brisbane-Downs run, particularly if they are getting backloads of barley coming in by boat from South Australia and Western Australia.

Barley for its fibre is being used at a maximum inclusion rate of around 10 percent in poultry rations, with wheat generally forming the rest of the 60-70pc grain component in feed.

Feedlots using wheat over the winter have generally swung into barley, the preferred grain for summer months, particularly in the light of temperatures nudging 40 degrees Celsius in some parts of Qld in recent days.

With domestic maltsters believed to have finished their new-crop buying in the north, Stewarts Grain trader Robert Quinn said good-quality barley within malt specs appears to be going into the feed market.

“Generally speaking, the quality of barley has been exceptional,” Mr Quinn said.

Surprisingly heavy test weights of around 75kg are common, and the lack of high protein keeping big volumes of wheat out of the premium Prime Hard milling grades has been a boon for barley.

Mr Stewart said the strength of the north’s domestic feed demand for barley was  likely to keep loads that made malting specs delivered from here on in in the local market because exporters could buy out of southern Australia for much cheaper.

“At around $500/t delivered Brisbane, we’re maybe $100/t above SA and WA.”

Depot bids are providing some heady competition for consumers looking to buy wheat and barley off the header.

“A lot’s going into town; some growers are happy with the price and selling.”

He said extremely dry conditions spreading in northern NSW were holding some growers back from meeting the current market.

“It’s hard for them to decide to sell grain when they walk outside and see how things look.”

The dry outlook has seen only a tiny area of dryland sorghum planted to date in northern NSW and southern Qld as the ideal window closes for getting early crop in the ground.

However, some irrigated sorghum has been planted.

Many growers on the inner slopes of southern NSW, in Victoria, and in south-eastern South Australia are looking at average or better wheat and barley yields and good quality.

Harvest for them is expected to start by mid-November, and wheat and barley cargoes booked to China have dominated early new-crop sales.

Windrowing of canola is the No. 1 activity taking place on farms across south-eastern Australia this week, and some desiccation of pulses as well as barley harvesting is also taking place.

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