Northern grain markets soft ahead of holiday period

Buying prices into the Darling Downs have crumbled over the past 10 weeks after the onset of late spring rains. Barley bids were back a further $10 last week to $420 delivered and are now back $45 since early November. Stock feed wheat bids into the Downs have also plunged over the same period.

Grain buyers have removed most of the drought premiums that were built into the northern markets through the dry winter months. Newcastle APW wheat bids fell $20 a tonne to around $405 port equivalent, only reflecting modest premiums to Victoria which has seen a bumper harvest.

Nearby demand is scarce with many of the feedlots already covered deep into the first quarter of 2024. Exporters have shown limited appetite to commit to northern ports with the smaller northern crop although the collapse in prices may alter this.

Smaller declines were seen in other port zones. Victorian grain values were softer with wheat and barley bids ended the week $5-10 lower.

The Victorian grain harvest has proved a surprise package. Most farmers are reporting better than expected yields. Some growers are saying wheat and barley yields have eclipsed pre-harvest expectations by as much as 20 per cent.

GrainCorp reported its largest weekly grain deliveries in Victoria in the first week of December and could top last year's state deliveries of 3.93 million tonnes when harvest wraps up.

Tropical weather continues to help summer crops. Farmers in these areas were happy to avoid the damaging rains seen across parts of FNQ. Isolated storms resulted in 5-50 millimetres across the Central Highlands with little rain across the Darling Downs. Nonetheless, ample soil moisture and the tropical conditions are allowing strong vegetative growth for sorghum crops.

Medium term weather outlooks are still pointing to broadly drier and hotter than normal conditions for the first quarter of 2024, although models are showing that eastern Australia may not be as dry as was earlier forecast with northern Australia and the WA expected to be the driest.

The Bureau of Meteorology ACCESS model is forecasting a continuation of the wetter pattern for eastern Australia in January before turning drier in February and March.