In spite of harvest selling pressure on the market there has been a slight rally in east coast and South Australian wheat values, bringing prices more into line with bids in Western Australia.
Late last month a solid premium had opened up for Western Australia wheat, above the normal $35 a tonne freight advantage into exports markets.
Clear Grain managing director Nathan Cattle said the higher prices in Western Australia may have played a role in bringing up prices in other regions.
“There has been really good demand in Western Australia and on our grain exchange we are actually seeing prices traded above the published bids, so there hasn’t been that drag down on prices you often see at harvest.”
In spite of the Grains Industry of Western Australia raising its estimates for wheat production in the west to 10.3m tonnes, just over a 4 per cent upward revision, the prices have remained relatively solid.
Briefly Kwinana APW prices touched $405/t but are back to around $380 to $385/t, but elsewhere prices have risen, including in South Australia, to around $340/t and Melbourne, $345 to $350/t.
Mr Cattle said the market was closely watching the impact of rain.
“Downgrading could impact the crop composition so it might be something we see emerge in terms of the spreads between different grades,” he said.
“We’re already seeing some outperforming bids for off-spec grain in Western Australia, which has also had some weather issues, so it will be worth farmers establishing the price they want for their grain rather than just taking the bid.”
There have been reports of downgrading through parts of NSW, including the Central West and the South West Slopes and similar damage is expected in parts of Victoria, particularly the Mallee, when headers get rolling once again.
The massive series of rainfall events across the east has put a dampener on deliveries, with virtually all areas experiencing at least some rain to delay harvest.
GrainCorp reported a strong week at its central NSW sites, however, Victoria was markedly slower due to the rain.
Andrew Whitelaw, Episode 3 commodity analyst, said the market was looking for a strong lead in light of a quiet international scene.
“The production locally is broadly in line with what was expected beforehand, perhaps a tick up on expectations but not enough to have a massive impact on pricing and internationally things are relatively calm, so things are remaining fairly steady,” Mr Whitelaw said.
News source: https://www.farmweekly.com.au/story/8836430/wheat-prices-rise-slightly-in-east-following-wa-harvest-lead/?cs=5153
