Grain Report Monday - 30th September
What price do you want for your grain?
Overnight moves in international markets and yesterday's actual traded prices across Australia are below to help you determine your price. If you need to change your offer price, simply edit it before market open.
Morning!
Welcome to my grain market comment. I’m really looking forward to keeping you informed and bringing market insights that will help you make better grain marketing decisions.
Some key market themes and things to watch…..
Wheat has been dragged lower by aggressive Russian harvest selling despite global wheat stocks tightening the past few years. The wheat complex may be tighter than what anyone wants to admit – European production estimates keep being wound back while the USDA expects this to be offset by larger Aussie (?) and nth American crops. We are waiting for US exports to lift as a signal that Russia is out of wheat and that importers are having to source wheat from higher priced suppliers (4-6 weeks hopefully). A market watch is ongoing dryness across eastern Europe that has delayed winter wheat planting and is already seeing next crop production estimates out of Russia being cut.
The harvesting of a massive US corn crop and news that China has unofficially told importers to cut feed grain purchases has seen the spread between wheat and corn increase. China is trying to stimulate its economy which may help demand but the best hope for feed grain prices near term is if dryness continues across Sth America and further delays corn planting there.
The oilseed complex has been volatile, particularly canola after China announced its anti-dumping probe on Canadian canola exports. It’s fair to say the market is still trying to figure out the implications for canola trade flows. Like with corn, the best hope of a sustained rally is if dryness continues in Brazil and curbs production potential. The Brazilians were expecting to increase soybean plantings by 13% but as each dry week passes it’s looking more unlikely.
Friday’s night's trading action….
Friday night's action was mixed with wheat a little lower but corn and beans higher as Hurricane Helene threatened crops and critical grain logistics infrastructure through the US Gulf Coast region. The remnants of this system are still being felt through the US South-east. The implications for grain markets are difficult to assess but it appears that damage and dislocation of services will be significant. Tonight’s trading on US grain markets could be interesting.
Local markets…..
Local markets inched higher last week despite global markets trading sideways and the $A firming (Aussie basis higher). The rainfall system that passed through was disappointing for WA and SA/VIC but positive for southern NSW, the NSW slopes and tablelands and eastern Downs of QLD. Expect basis in southern and western markets to continue to firm with SA/VIC crops still under pressure.
BOM expects another similar system to pass through in the next week. While it won’t be the cure all for struggling crops it at least gives hope that weather patterns are changing for the better and we might see a soft Spring.
The $A is being buoyed by Chinese stimulus measures and ideas the US economy is heading for a soft landing with risk appetite increasing. Next stop is the Jan 23 high of 71USc if commodities continue to rally and if Bullock shows no signs of taking the brakes off.
CGX Monday morning open call…..
Expect an even open this morning with the $A punching at 69USc and some more favourable weather patterns in the offing.
For further market commentary please contact the CGX team on 1800 000 410
CGX now own and operate the igrain market for grain stored on-farm
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