Grain Report Monday - 28th November
Our goal is to help growers and their agents determine the selling price for their grain by providing relevant price discovery each day. Check out the moves in overnight international markets and yesterday's actual traded prices across Australia. There's also market commentary giving context and comparisons to prices of international physical markets. If you need to change your offer price, simply edit it before market open.
What price do you want for your grain?
Look Out!
Wheat markets were off on Friday night, corn was firmer on strong weekly exports and Beans up slightly.
The ASX Jan 23 wheat contract has fallen AUD77.50 PMT, and the AUD has firmed 3.53 cents.
The impact of the AUD on ASX (export returns);
FOB Price = USD$370 FOB and FX 06395 on 1st Nov = AUD578 FOB and at FX $0.6748 = AUD548 FOB.
The Export value ex Australia has fallen AUD$30 on the currency drop.
The “Zero” Covid policy in China is causing protests and unrest and the world sees this situation as “Bearish” commodities.
China was our largest buyer of wheat 21-22, taking 6 million MT. Maybe our wheat is traded differently to barley with all the government subsidy and price discounts (dumping) removed.
Maybe Xi Jinping will look at the Victorian Election results and continue to follow Dan the Man’s Covid lockdown stance.
Russian wheat is the cheapest Milling wheat on the world stage.
WA FOB values are quoted at USD369 FOB, which would put East Coast at low USD360’s if we were to compete into same markets.
EU feed barley is indicated around $330, which would work back to $440 Track VIC (not far off the APW price).
The bottom of the Feed Barley market is Russia at USD290, which is $379 Tack Vic or ~AUD$400 FIS WA.
The current East Coast market is trading well under these values, which doesn’t make sense, because by all reports, test weights are a big issue, and BAR1 supply might tighten.
If we revert to export parity with the bottom of the market (Russia), Vic / NSW barley should be $40-$50 higher.
Again, markets are trading under these values, however, jury is out on how much SFW will be produced?
If the market is expecting SFW values to fall away, the bottom at export parity is around a $420 Delivered Melbourne markets.
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