The "just in time" rain in WA could form the base of this years Crop, again

By: "Farm Tender" News
Cattle News
Jun 19, 2019
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By Bridie George - AWB

While the dry continues in Northern NSW and QLD, Central NSW is increasingly feeling the pinch following disappointingly light and patchy rainfall. However, prospects are firming in the southern part of the state with some areas only one good fall away from a firm production outlook. Victoria is also looking positive after widespread rain across central, western and southern regions and rains arrived in WA just in time to improve planting and germination prospects to a level that could form a base for this year’s Aussie crop.

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Globally, the United States Department of Agriculture (USDA) report that was released last week cut expected corn yields in the US by a hefty 10 bushels/acre which was more than anticipated, however the planting progress report showed strong numbers in wheat’s corner with 64% of US winter wheat considered good to excellent and 81% of US spring wheat condition rated in that category, both of which are above the 5-year average.

Despite the corn yield cuts, 19/20 estimated global production managed to hold its ground in this edition of the USDA’s World Supply and Demand Estimates Report at record highs, with Russia, India and Ukraine seeing increases around 1 million mt each.

Another factor in the bears’ sights is that despite recent dry conditions in the Black Sea, they continue to move closer to harvest which could weigh on CBOT as this crop becomes available.

The bulls ultimately came out on top with wheat still managing to follow corn’s firm lead and strengthen a notable US 40 cents/bushel in a week.

Domestically, the Griffith market continues to hold its own for nearby delivery and worked to pull tonnes from over the Victorian border at the recent highs of $410. After retreating $10-$20 bids opened Monday back at the $400 mark.

Trade estimates pegged the barley plant at around 71% complete with revised targets of 1.6 million hectares on the East Coast and 4.2million hectares nationally, down approximately 100,000 hectares from start of season estimates. However it is generally still holding an increased percentage of the rotation to wheat year on year. The old crop barley carryout also presents a burdensome prospect when combined with new crop size estimates. However old crop ex-farm barley parcels continue to attract premiums fetching $400-410 at the farm gate in Southern NSW.

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Sorghum markets remain subdued with sellers and consumers quiet. While there has been some enquiry from China recently, no buying has occurred in the last week and US sorghum has also fallen sharply, making it look particularly cheap when compared to turmoil-ridden corn. Something to keep in the peripheral vision should there be any sudden resolution to the US/Chine trade war –albeit looking unlikely.

Newcastle sorghum track values opened the week where they left off at $370 while delivered bids are very thin and continue to be centered from the QLD border north.

Similarly, old crop canola markets have continued to trade in a narrow range with crushers seemingly comfortable with current coverage. New crop showed slightly increased signs of buoyancy, however production risk with the current weather outlook is keeping growers hands in their pockets.

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