Market updates for barley and wheat have been announced.
Barley market update
Saudi Arabia has announced the purchase of 1.02 million t of Feed Barley for delivery in February - March 2020. The barley is to be sourced from the EU, Australia, North and South America and the Black Sea region. The average price for this barley was US$216.62 per t delivered. This equates to an approximate Port Lincoln/Lucky Bay port price of AUS$237 per t suggesting current cash pricing is very competitive into export markets - in a year when the domestic balance sheet is tight.
In domestic Australian markets, the Darling Downs delivered feed barley market (Jan +) is currently trading around AUS$370 per t which equates to an approximate Port Lincoln/Lucky Bay port price of AUS$260 per t.
The first sowing window for the Australian sorghum crop has closed with very little sorghum sown. Considerable soil moisture deficits exist in southern Queensland and northern New South Wales, potentially limiting the size of the Sorghum crop. Any shortfall in feed Sorghum production will most likely be substituted into domestic feed rations by feed barley.
Wheat Market Update
The Grain Industry Association of Western Australia (GIWA) has released their November crop report. They estimated the Western Australia wheat crop to be 5.85 million t. Flexi Grain estimate Australian wheat exports this marketing year to be approximately 7.5 million t with the Western Australia crop supplying approximately 5.0 million t of these. This would suggest South Australia and Victoria crops would need to supply approximately 2.5 million t of export demand. Flexi Grain's current production estimates suggest South Australia and Victoria will produce approximately 7.0 million t of wheat. South Australia and Victoria domestic consumption and interstate transfers of wheat into New South Wales and Queensland is estimated at 4.8 million t resulting in approximately 2.2 million t available for export demand.
Black Sea December 2019 wheat futures are currently trading at US$209 per t which equates to approximately AUS$307 per t. At current cash pricing allowing for freight and fobbing costs, Australian wheat is competitively priced into many Asian markets.
In domestic Australian markets, the Darling Downs delivered feed wheat market (Jan +) is currently trading around AUS$415 per t which equates to an approximate Port Lincoln/Lucky Bay port price of AUS$305 per t.
Read the article online at: https://www.drybulkmagazine.com/special-reports/25112019/flexi-grain-market-update/