Tech News, Magazine & Review WordPress Theme 2017
  • Supply Chain Updates
  • GLOBAL NEWS
  • REGIONAL NEWS
  • Industry Buzz
  • CURRENT ISSUES
No Result
View All Result
  • Supply Chain Updates
  • GLOBAL NEWS
  • REGIONAL NEWS
  • Industry Buzz
  • CURRENT ISSUES
No Result
View All Result
United States Supply Chain Management Council
No Result
View All Result
Home Supply Chain Updates

Market awaits news from China as barley harvest begins

usscmc by usscmc
November 9, 2019
Market awaits news from China as barley harvest begins
Share on FacebookShare on Twitter

Farmer selling has picked up over the past week as the 2019 harvest gathers momentum in the southern grain-growing regions of Australia.

The market pressure created by this increase in supply, in conjunction with a rally in the Australian dollar, pushed grain prices lower across the board.

The central Queensland wheat harvest came in close to industry expectations at around 375,000 tonnes, and on-farm storages are filled to the brim as growers take advantage of a lack of production in the southern part of the state.

This grain will be trickled into the domestic market over the coming months, filling part of the void created by abysmal production in southern Queensland and northern NSW.

The southern Queensland harvest has come and almost gone in a very short period of time.

There were isolated pockets of harvestable grain that weren’t cut for hay, but on the whole, the ongoing drought has pushed production lower than last year’s dismal total.

The story in northern and central NSW is no better.

These regions should be a hive of activity with headers rolling and queues at the local silo a feature.

Instead, the paddocks are bare, and many silos haven’t even opened due to the record low production.

What has been produced will go directly into the domestic market or is being stored on-farm for delivery to local end-users in 2020.

The production outlook in southern NSW, Victoria, SA and WA is far better, and this is where the supply pressure is being seen as growers look for cash flow by selling off the header.

Falling grower bids may well stem the tide of selling, so cash prices become a function of how desperately the trade need to buy.

With domestic demand covered, export interest will be the most likely catalyst for an increase in buyer appetite.

Barley has dominated harvest proceedings thus far.

Reports from the field suggest that early barley quality, and yields, have been quite variable as the tough finish manifests itself in high screenings and low malting barley selection rates in many districts.

That said, it seems that yields, on the whole, are surprising to the upside.

The price of wheat delivered onto the Darling Downs retreated around $5 last week to close at about $410.

WA and the Eyre Peninsula are the regions most likely to ship wheat around to Brisbane over the next 12 months, and grower bids at those ports fell by around $7 across the week.

Geelong bids fell by the same number.

On the other hand, the price of feed barley delivered Darling Downs region remained steady across the week at around $375.

The Geelong and Kwinana feed barley bids fell by $10, and the Port Adelaide and Port Lincoln bids fell by $5 across the week.

Port Lincoln is the cheapest Australian grain at the moment with Australian Standard White wheat and feed barley values now down to US$225 Free on Board (FOB) and US$193 FOB respectively.

Kwinana port values sit at around a US$8 premium for both grains.

Both ports should be competitive into the wheat export pathway at those values, and recent sales of wheat out of WA support that notion.

Barley, however, is a different story.

Australia has relied heavily on China in recent years.

November 18 is the anniversary of the launch of the anti-dumping probe by the Chinese Ministry of Commerce (MOFCOM).

Under the World Trade Organisation (WTO) regulations results of such investigations, or some guidance on potential actions, are expected within 12 months, but a six month extension can be granted.

The Australian trade will be looking to Beijing to provide such guidance, whether positive or negative, in the next few weeks so that the market has some direction and certainty through harvest and into the new year.

There are rumours of small volumes being traded, but most exporters are not willing to entertain Chinese enquiries due to the execution risk any sales would present under the current circumstances.

So, where does the Australian barley exporter look in the absence of Chinese demand?

Saudi Arabia is the logical answer.

Black Sea values were sitting at around US$190 FOB last week.

Add freight of US$25 makes it US$215 Cost & Freight (C&F) into the Red Sea port of Jeddah.

That compares US$226 C&F ex WA using US$200 FOB Kwinana and freight of US$26.

Out of Port Lincoln, it works out at US$223 C&F using freight of US$30. So no joy into Jeddah at current values!

How about the Persian Gulf port of Dammam?

Freight from the Black Sea into Dammam is around US$11 over Jeddah.

Freight out of Australian ports would be the same as Jeddah.

Suddenly, at last week’s prices, Australia is competitive against Black Sea origin for the next Saudi tender.

However, Argentina could well rain on our parade.

Export barley values out of the deep-sea port of Bahia Blanca were quoted at US$170 last week.

Add freight of around US$42, and Argentina trumps both the Black Sea and Australia at the next tender.

Argentina likes to get the business on early, so are also likely to be the weakest seller.

This is especially the case at the moment as the new Peronist government is threatening to increase export taxes.

The only other obvious export options at the moment are Thailand and Indonesia.

The later is expected to be looking to Australian supply once the free trade agreement has been ratified.

It has been tabled in the Indonesian parliament and will be debated in the Australian Senate this month.

Endorsement by both parties is expected by year’s end.

Domestically, the Queensland stockfeed market will continue to require feed barley from Victoria, SA and WA for the next 12 months.

At the current delivered Darling Downs spread of $35, feed barley is buying demand away from wheat, and the consumer has been taking advantage of the relative value in recent weeks.

Start the day with all the big news in agriculture! Click here to sign up to receive our daily Farmonline newsletter.

The story Market awaits news from China as barley harvest begins first appeared on Farm Online.

usscmc

usscmc

No Result
View All Result

Recent Posts

  • Supply Chain Issues Delay Michigan Statehouse Welcome Center
  • Last Mile Delivery Market Size, Growth And Forecast
  • High shipping rates could increase inflation by 1.5%: IMF
  • Coast Guard responds to adrift cargo ship off California
  • Underinsurance as a Persistent Driver of Cross-Border Antibiotic Procurement in U.S. Border Communities

Recent Comments

  • Top 5 Supply Chain Certifications that are in high demand | Top 5 Certifications on Top 5 Globally Recognized Supply Chain Certifications
  • 3 Best Procurement Certifications that are most valuable | Procurement Newz on Top 5 Globally Recognized Supply Chain Certifications

Archives

  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • September 2019

Categories

  • Global News
  • Supply Chain Updates

Meta

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org
United States Supply Chain Management Council

Categories

  • Global News
  • Supply Chain Updates

Tags

APICS Globally Recognized Supply Chain Certifications IIPMR Certifications International Institute for Procurement and Market Research (IIPMR) ISM Next Level Purchasing Top 5 Supply Chain Certifications top supply chain certifications

Trending

No Content Available
  • Privacy Policy
  • Terms of Use
  • Antispam
  • Disclaimer
  • Contact Us

© 2022 www.usscmc.com

No Result
View All Result
  • Supply Chain Updates
  • GLOBAL NEWS
  • REGIONAL NEWS
  • Industry Buzz
  • CURRENT ISSUES

© 2022 www.usscmc.com

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Cookie settingsACCEPT
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.

Non-necessary

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.

SAVE & ACCEPT