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Grain Comment, 28 August

Local grain prices firmed this week as consumers started to cover some nearby demand. There is very little local grain left, so most of this demand will be serviced from the mainland.

Prices in Northern NSW and Southern Queensland are pulling local prices higher, with the onset of hot/dry weather and feedlots full to capacity, grain is moving from Southern NSW and Victoria to satisfy demand. At the same time export shipments continue to be robust.

Fortunately, farmer selling has been good to meet the demand, otherwise prices could be a lot higher.

Weather continues to be a focal point for grain merchants trading global futures markets. The US has turned hot and dry again which may impact the yields for soybeans. Canadian canola harvest has started, so we should get a good idea on what the drought has done to yields within the next two weeks.

While the crops on the mainland have great subsoil moisture, we are very unlikely to repeat last year’s record yields. In Southern Tasmania dry conditions are starting to have an impact on pastures and crops south of Oatlands. Many of the cereal crops these days are irrigated so for the moment it is unlikely to have a significant impact on local supply.

The outlook for grain and oilseeds prices remains positive.


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