Grain Report Wednesday - 01st February
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.
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Look Out!
Wheat up slightly and corn and soybeans mixed.
Well, that’s the 1st month of 2023, done and dusted.
As we move into February, the focus shifts to the Northern Hemisphere winter wheat crops as they come out of dormancy.
There is a cold snap hitting the USA, which is not great for their winter wheat crop, which hasn’t had the greatest start for 22/23.
There are dry regions in the southern parts of Russia, a major wheat growing area, which again is a slight concern; but early days though.
The market is also still looking at the slow planting pace of the Brazilian 2nd corn crop, known as the safrinha (small crop).
The Safrinha is around 52 million tonnes, and their 1st crop is 73 million tonnes.
The critical time for the corn safrinha is April through to June, when the crop pollinates and fills grains. This is the autumn and early winter period in Brazil, which is also when their rainfall reduces, making the safrinha a riskier crop to produce.
The later it is sown, the greater the risk for frosts, less rain, and lower yields. If this happens, we will need to take this crop to the beauty salons for a Brazilian.
Total corn production in Brazil is forecast to be 125 million tonnes this year.
Brazil accounts for 26% of world corn exports.
Things in Argentina are also not looking great for the February rain forecasts, which can impact on their corn crop and soybeans crop.
Argentina produces around 50 million tonnes of corn and accounts for 21% of world exports.
Hence when we talk about South American corn, their combined exports account for almost 50% of the world corn exports.
The other country to keep an eye on is India. Their chests are pumped out, going the early crow they are going to produce a record 112 million tonnes of wheat this year. They did the same last year, and then their crop got smashed in March as temperatures rose over 40 degrees.
India is having some food inflation issues as the government has been releasing stocks to try and calm down domestic prices. However, the government is running out of stocks. Their stocks in December were 19 million tonnes, the lowest in 6 years. Good golly blime me.
If India has a warm March – April, this would be a game changer as they will become an importer.
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