SOUTHERN Queensland’s feedgrain deficit is widely expected to bring at least one wheat cargo into Brisbane in coming weeks.

The move reflects the difficulty Brisbane consumers are having in getting grain past the heated Darling Downs and New England markets amid ongoing dry conditions.

In the south, early winter crop is being planted ahead of Anzac Day, which falls on Saturday and marks the traditional opening date for planting canola, pulses and cereals.

Grower selling of wheat and barley in both the north and south remains thin, with southern growers prioritising planting, and northern growers unsure how much, if any, winter crop they will be planting in coming weeks.

	Apr 16	Today
Downs barley	$430	$440
Downs SFW	$420	$440
Downs sorghum	$360	$355
Mel barley	$350	$348
Mel ASW	$380	$370

Table 1: Indicative prices in Australian dollars per tonne.

Brisbane wheat feels the heat

The northern trade is abuzz that a cargo of wheat from South or Western Australia has been booked, or is close to it.

Volume is expected to be around 30,000t, and would service poultry and feedmill clients in the Greater Brisbane region.

“With ASW wheat into Brisbane at $460/t delivered, and $125/t to get in from free in store Kwinana to free on truck Brisbane, wheat from WA will work,” one trader said.

Volatility in currency markets, a function of the Iran-US war and its impact on energy and fertiliser supplies, may also make a domestic cargo or two an attractive proposition.

“If you’re a WA exporter, are you going to sell into The Philippines in US dollars, or are you going to look after your local people?”

Domestic wheat shipped into Brisbane is not expected to calculate on to the Downs, which is now sourcing considerable wheat and barley volume from central New South Wales.

Domestic consumers are bidding $440/t for wheat delivered Downs into June, and poultry and pig markets are also buying sorghum in reasonable volume as its discount to white grain widens.

Inflated cereal values mean wheat and barley from Central West NSW are making their way to consumers in southern Qld, while barley from as far south as the Victorian Mallee is heading into northern NSW, including the New England, for drought feed.

“When grain was $350 delivered Downs, we couldn’t get it from anywhere south of Moree,” one consumer said.

While plenty of wheat is still either stored on farm or warehoused in northern NSW and southern Qld, its owners are expected to sell it in the new financial year to counter the impact of a small winter crop at best planted in the current window.

Barley is being planted in parts of the northern region, mostly in pockets of Qld’s Maranoa, following recent rain.

In the south as well as the north, growers with urea booked prior to Iran-US hostilities closing the Strait of Hormuz are thinking seriously about selling it as a cashflow option.

Northern growers with little to no subsoil moisture will have no need to top-dress in coming months, so could make up to $600/t on urea now trading up-country at around $1500/t.

South

In the south, most growers have all their planting fertiliser on hand, and enough urea for a round of top-dressing.

Some growers who are switching a paddock or two to pasture or pulses from canola or wheat also have surplus urea, and are looking at selling it locally.

Pinion Advisory Horsham-based broker Andy Brown said maximum daytime temperatures have been unusually warm, and topsoil has dried out to the point where early sowing has ground to a halt.

“Anzac Day is really our kick-into-gear day; we’ve got moisture underneath but we’re in no man’s land because the top is dry, and the weather’s been hot week this week,” Mr Brown said.

Growers in the Vic Mallee and Wimmera, and into South Australia will happily plant into early June, but are likely to finish next month with dry sowing.

“Most will stick with sowing at normal depth; we only need 5-10mm of rain and everything will link up in terms of soil moisture.”

Mr Brown said domestic demand for cereals was evident, but even the $20/t rally seen over recent weeks had not been enough to draw out much volume.

“Most growers are just in cropping mode.”

Mallee barley selling into the NSW Riverina and markets further north is selling at around $310/t on farm, on par with rates for Wimmera barley selling into Melbourne for domestic use and export.

The Wimmera faba bean market has also kicked to around $350/t , with bulk still being accumulated for what looks like being the last cargo or two for the season from Vic.

CGX

Drying conditions in north-eastern Australia is having a trickle-down tightening impact on grain supply around Australia.

It’s seeing buyer appetite to secure grain increase in all parts of Australia and lifting prices.

In his market comment released on Monday, Clear Grain Exchange managing director Nathan Cattle said traded prices have risen significantly in Qld and northern NSW with ASW1 wheat trading $425/t ex-farm through igrainX.

With an approximate $15/t freight to the Darling Downs, this supports the delivered market at $440/t.

“Drying conditions have seen the accumulation arc into this region spread further down the east coast, meaning prices must increase to pull the grain up to where it’s needed,” Mr Cattle said in his report.

The number of buyers purchasing grain through NSW via Clear Grain Exchange each week has been 27, 25, and 27 respectively over the past three weeks, well up on an average of 17 buyers over the 10 weeks prior.

“Price lifts have been driven by feed demand with little price differences between lower grade grains and better milling-quality grades such as APW1.

“However, millers are still active and trying to stay ahead of the widening demand arc with grades such as APH2, H1, H2 attracting premiums when grain is offered and prices are asked for.

Mr Cattle said the demand profile has flowed into southern states, with 24 different buyers purchasing grain last week through Vic.

“Plenty more buyers are searching for grain offered for sale.

“Vic demand is being driven by the pull for grain into those northern markets; it means the Vic end-user also needs to get active to secure supply.

“In SA and WA, the widening demand arc for grain into the north-eastern markets and increased prices there means it becomes another potential export destination for grains.

“That’s been supportive to price, particularly with comparatively less export competition from other parts of the world at this time of year.

“Grower prices have been leading this market higher.

“Growers are setting prices, bids have been coming up to match, and the north-eastern market prices have quickly risen to near full execution to import grain from southern export orientated states.”