Steve, Erin & Jake from the AgVantage team attended the Mungbean Crop Walk held at Xavier Martin’s property ‘Bourbah’ near Mullaley. The event was held by the Australian Mungbean Association and Pulse Australia and was well attended by industry participants from growers to end users, industry representatives and agronomists, possibly due to the bacon and egg spread put on in the morning by the boys at Pursehouse Rural. The day kicked off with an overview of where the Australian mungbean market is currently positioned in it’s global context and the benefits it can offer growers as an alternative summer crop, with introductory talks by Senior Development Manager of Pulse Australia Gordon Cumming, current head of AMA Todd Jorgensen and Xavier Martin. Xavier won the AMA mungbean crop of the year in 2012, and shared his thoughts on his recent trip to growing regions in India and witnessed the country’s strong appetite for the bean.
Following this we trekked down the paddock to the GRDC mungbean trial plots where Col Douglas told of the work he and the AMA have been putting in to developing new breeds of mungbeans. The most promising line they are hoping will be available for commercial use soon, M07213, showed 12% yield gains over the Crystal variety based on 5 years worth of trials, while also exhibiting increased resistance to Powdery Mildew while maintaining the other benefits of the Crystal variety. Other varieties on trial have shown improved resistance of Halo Blight, a problem which has an increased prevalence during 2013. The improvements the GRDC are making follow the large increase in performance of the initial release of the Crystal variety, which itself saw a 20% increase in yield over its predecessor. These achievements are especially impressive given the size of the industry and funds available to them, especially since mungbeans are relatively new to Australia, having been grown here for the past 30 years, and 3000 years in China.
A few other points on mungbeans taken from the morning include a total crop size this year of about 25,000mt, down significantly from last year’s 50,000mt crop. Demand for mungbeans remains high following on from high prices seen in the last few years of around $900/t. Australia’s competitive advantage in mungbeans comes from our ability to deliver a high quality product to the export market. The sharp discount for grades below processing grade usually experienced in the Australian market reflects the opportunity for consumers to source lower-grade quality product, from growing regions with a significant freight advantage into the subcontinent. This being said mungbeans are able to exhibit strong rates of return, along with the fact that they are generally a 90-day crop. With the investment in research and development going on at the moment the industry is likely going to continue to grow and mungbeans increase as an option for growers looking to plant summer crops.
ASW XF April pickup
Sorghum – SOR1 April, varying discounts for SOR2/SORS
Corn – Prime Maize/Feed XF
H2/AUH & HPS1 (Newcastle Track)
APH2 delivered Brisbane
Mungbeans – XF or Delivered Goondiwindi
Canola – Strong demand system
The general theme across most major soft commodities was that volumes were very light in anticipation of the USDA’s end-of-month reports on quarterly grain stocks and prospective plantings due out this Friday. Wheat finished down 2.5 USc/bushel at 727.25. Another weather system is expected to cross the western plains over the weekend and early April, which will help soil moisture. In other world news there were offers taken to an Iraq wheat tender and traders noted that Australian wheat was the cheapest offered. Corn finished up 6.25 USc/bushel at 732.5,mainly due to thoughts that ethanol demand is on the increase, and also another round of moisture in key corn regions delaying planting, which added further support. Soybeans finished down 3.5USc/bushel at 1437. Thoughts that China’s old crop soybean demand may have been overstated given Feb/March shipments were down have weighed on the market.
May cotton futures eased on more talk of release of state reserves from India and China at 86.46Usc/Lb. There were also reports that the US plantings look higher than expected however volume remained relatively low as traders look to Thursdays USDA before committing themselves to more sizable positions. There was one positive voice in the market where a report from Macquarie Group signalled that they still believe in a 100 cent/pound cotton price before end of year.
Domestically, our local grains market have continued to come under pressure from the markets pre-emptive moves ahead of this USDA planting intentions report to be released on Thursday night. The wet weather over the weekend went a little way to filling the moisture gap ahead of winter crop planting. The wheat markets are continuing to slide, barley demand continues to be non-existent, whilst sorghum continues to come under pressure due to harvest selling pressure and the fact consumers are buying hand-to-mouth with the expectation that sorghum values will need to fall to become competitive in rations again. Later sorghum crops have benefited from improved growing conditions in comparison to earlier crops. Canola has received a kick, from the announcement that China will again begin taking Australian Canola. This led to a local increase of $13/mt overnight Thursday night and heavy grower selling on Friday. Values today remain strong and we strongly encourage growers to consider pricing old crop canola in the system as new crop values are $60-70/mt below old crop values. The chickpea market continues to hold slightly below grower selling levels, the information from the subcontinent continues to puzzle those in the pulse business regarding demand for Aussie peas ahead of and during Ramadan. Today we are seeing $485-490/mt delivered Narrabri, which was non-existent last week and it’s anybody’s guess whether this demand will stick around or disappear as small tonnages of chickpeas are continuing to trade.
AgVantage has strong demand for new crop mungbeans and currently have hectare contracts available for the upcoming harvest. We strongly recommend giving us a call to discuss the types of contracts available for this season.
• Faba beans XF – limited tonnes
• APH2 – XF NNSW, system sites Moree north or delivered Brisbane. Limited to 500mt only for April/May pick-up/delivery and March transfer
• H2 delivered Narrabri
• Limited volume APW delivered Narrabri
• Sorghum – homes are readily available for SOR2/S in NNSW/SQ
• Sorghum 1 & min test weight 66 SOR2 delivered Narrabri for prompt delivery
• Corn – both prime maize and Feed – XF all regions
Call AgVantage Commodities 02 6792 2962
After a major review of its bond-buying program, the Federal Reserve decided to stick with its $85 billion a month of asset purchases, the Fed also kept its federal funds rate target unchanged at a record low range of 0 to 0.25%, where it has been for over four years. The US Dollar edged down against most major rivals Wednesday, holding to losses after the U.S. Federal Reserve said it will continue its bond-buying policy. All things being equal is should be seen bullish for commodities as a weaker US Dollar is seen to strengthen global commodity prices.
Wheat reached a three week high in Chicago on expectations that its discount to corn will boost the amount used to feed livestock in the US, the May contact rose almost 2% to finish at 736c/bu.
Corn prices may be supported in the next 3-6 months as wet conditions erodes prospects for Brazils second harvest while Soybeans are expected to drop as shipping bottlenecks ease. May corn rose 0.5% to 732c/bu while May soybeans fell almost 1.25% to 1457US cents/bushel.
Brazil is set to become the largest exporter of soybeans where production could reach a record 81 million tons. Ports will be busiest from June to August as the corn harvest accelerates, and logistics in Brazil will be a key determinant in prices for corn and soybeans over the coming season.
On the cotton front, US futures took a dive overnight with the May contract closing sub 90c/lb to settle at 89.10, a fall of over 2.25% on the news that India will follow China and sell cotton to local mills from its state reserves lessening the need to fill their orders from overseas exporters.
Overnight Canadian canola futures were down by around $0.6 to $623.30CAD.
Domestically, this week we have seen stronger selling interest in grain from the northern border-region and sorghum values for prompt movement have dropped $10/mt. In terms of consumer demand for sorghum, it is declining and they are stepping aside and looking to purchase wheat or barley to use in rations instead of sorghum, which they consider to be too expensive at current levels.
On the wheat front, NNSW and SQ are relatively quiet on the demand front although we do have snippets of demand still feeding through. Please refer to the commodities of interest section for more details on parcels we are currently looking for.
Faba beans although there are limited stocks still available are in demand. We have two buyers currently looking for small tonnages to finish of this year’s program. Ideally, they would be looking to source these in Northern NSW or west of the Newell but beggars can’t be choosers so if you have some smaller parcels you are looking to offload, we do have homes available.
We are seeing more new crop values posted from buyers each week. Currently Multigrade wheat contracts are available and there are a number of pricing/contracting styles available. As we look toward new crop plantings, there are still regions that require significant moisture or we will face the potential to lose some big acres this year.
– SOR1 XF Prompt movement, SOR2 XF Goondi to LPP regions. Varying discounts for SOR2 based on quality.
– Mungbean hectare contracts, call with any enquiries; Feed/Prime Maize Corn XF
– APH2/H2 del Narrabri; SOR2 $220 del Nbri, limited tonnage
– H2, APW XF or system Central West; APW, ASW1 & 70/10 XF March/April
Just when you thought the economic woes of Europe were under control another crisis springs up and sends the markets in to a spin. This time it is the small island nation of Cyprus causing all the fuss, with a condition of a bailout package from the ECB requiring the country to enact a tax on bank deposits. Cyprus has delayed passing the controversial bill, and the uncertainty created has led investors to abandon the Euro in a flight to safety, namely the US Dollar. A firmer US Dollar makes dollar denominated exports, i.e. agricultural commodites, less affordable to buyers in other currencies, resulting in softer prices in the futures markets. Soybeans were hard hit, with a loss of 15 USc. Wheat lost 10 USc, however is still holding above its new support level of 700 USc/bu to finish at 712 USc/bu, while corn managed a slight rise due to continued strong domestic demand in the US feed market. Currently the outlook for these markets is for greater downside potential than any significant rally. Cotton also took a hit overnight, with a loss of 175 points to close at 90.75 USc/lb, however this market is well supported at 90 USc/lb and likely to continue its strong run in recent weeks by testing resistance at 94 USc/lb.
Domestically, we are seeing demand continue for sorghum ex-farm in all regions. Prices are location specific and best to call to price a specific parcel as the numbers in the table are only a guide. SOR1 XF Narrabri traded at $240/mt last week and today is around similar numbers. Sorghum delivered Warwick today is $255 March, $275 delivered Brisbane with SOR2 and SORS being taken at Oakey $240 & $225 delivered respectively. On the LPP, SOR1 is around $240XF for March/April pick-up. With the current wheat/sorghum spread as narrow as it is, we are hearing reports that consumers are preferring to use wheat or barley in their rations. Sorghum in the export market is also expensive and for the price to be competitive into the export market, it needs to fall $10-15/mt.
Chickpea demand is still present but demand is certainly stronger for second half April/May delivery or pick-up. We do have buyers of chickpeas at the moment although they are telling us that demand from the Subcontinent is almost non-existent as the Indian crop is very large and supplies from Pakistan/Bangladesh are cheaper than Aussie supplies. Although chickpea prices currently are below where they were prior to harvest last year, they are still above harvest levels and historically at pretty good levels. Most growers are telling us they are holding out for $500+ XF but at the moment it doesn’t appear the market will reach this in the near-term. We have all been around long enough to know that chickpea values can be volatile at times but with no supply issues, the demand for Aussie peas seems minimal.
Mungbean values remain strong as demand from the Subcontinent and China remains strong. Today we have hectare contracts available at $950/mt No1 Processing and $900/mt Processing delivered Goondi for harvest delivery. These values have strengthened $100/mt since the end of Jan. We can look at Multi-grade contracts to include Sprouting and Manufacturing quality prices as well as Stockfeed values, which will be at market value at the time of delivery. Today, the Sprouting price is $1150/mt and Manufacturing quality is $650/mt. There are some beans coming onto the market from Burma at the moment which are largely Manufacturing quality, which is supporting Processing-type quality and capping Manufacturing quality prices. Please give us a call if you wish to discuss mungbean hectare contracts for the upcoming harvest.
We have demand for some small tonnage of faba beans. Quality-wise, we can take No2/3 as they are going into the feed market. As long as the sample is clean and free from dirt, the buyer will look at using them. Please call if you have some off-grade faba beans that may suit this market.
Today we have strong interest in H2 & APW in the system for Central West sites. Pricing is site-specific so please call with individual parcels.
Futures were mixed overnight with May 13 wheat up 6.5 cents at 710 cents/bushel. It traded both sides of unchanged and both the Kansas and Chicago exchanges saw pressure from corn and beans along with a stronger USD overnight. Profit-taking and favourable weather in the eastern corn belt also pressured CBOT wheat. Despite all this negativity, it posted gains. May corn fell 4 cents to close at 710.25 cents. Profit taking and a higher USD were the driving forces behind corn’s decline. Added to the negative tone was lower ethanol production for the week (1% lower than last week and 10.7% lower than the previous year). Corn use needs to average 87.9 million bushels each week to meet the USDA’s projections and this week was sitting just over 83 million bushels. According to data, there appears to be a short-term negative outlook for the corn market.
Soybeans posted massive losses overnight and the May contract fell 22 cents to close at 1446.75 cents/bushel. China’s port stocks are now shifting to stable levels as Brazilian vessels make way to fresh supplies. Rumours that US soybean sales cancellations could emerge are appearing. Favourable weather conditions for Central Brazil in the next week also added pressure to the beans market. Cotton posted strong gains overnight with the May contract up 126 points overnight and closed at 88.59 cents/pound. Support came from better-than-expected US retail sales.
Sorghum continues to be harvested in the northern regions and quality is still mixed, with borderline/low test weight the biggest issue this year. We have homes for prompt SOR1 xf for all regions and competitive system prices. Buyers for SOR2 are limited as consumers aren’t looking to take large volumes of off-grade sorghum. We also have a number of options for corn, both Prime Maize and Feed and for prompt pick-up. We have delivered Downs/Brisbane options as well as XF from the border regions, through to LPP and Central West locations. Please contact us if you are looking to price corn. On the wheat front, demand has pulled back for some grades as exporters are telling us that southern grain is anywhere between $10-20/mt ‘cheaper’ than our grain and southern NSW/Victorian growers are active sellers at the moment. In saying this, we do have demand for APW, H12 and generic H2 delivered Narrabri, as well as Gherkes. We also have demand for 70/10 in all regions on-farm.
Chickpea values are softer this week for delivery into Narrabri as immediate shorts have been filled. Last week we were seeing $500-505/mt delivered Narrabri, this week prices are closer to $475-480 delivered. Delivered Downs for Mar/April delivery is $500-505 and April/May $520-525/mt. Feedback from buyers on chickpeas is that demand from the subcontinent is very thin and one anecdotal report suggesting the subcontinent have enough stock to get them through to the Ramadan period, hence minimal demand. Ramadan period this year begins 9th July which is much earlier than usual, so vessels would need to be on the water by late May/early June to meet this period. Mungbean values remain steady this week at $850-900 delivered Goondi for a hectare-based contract. Please contact us to discuss ‘bells & whistles’ around these contracts.
Yesterday (Wednesday 13th March) I attended the Monsanto Cotton Grower of the Year Field Day which was held in conjunction with the MacIntyre Valley Cotton Field Day at Nigel & Vanessa Corish’s farm “Yambocully”, Goondiwindi. Matt Bradd and Karen Gilmour from ECOM’s Sydney office also travelled up for the day. Registration kicked off with a welcome from Nigel, and the group split into two as we jumped on buses and headed down the paddocks to listen to presentations. The first I attended was from Nigel & his agronomist Jim O’Connor. They gave a run down of the current crop’s development from pre-planting to now and how their management led them to receive the 2012 Grower of the Year title. At Yambocully, they have a field under a drip irrigation system and for someone with no agronomic background it was interesting to hear the benefits of using this system and how they managed this opposed to flood irrigation, which their other fields are under. Under the burning sun, I listened to how the crop has developed this year and how decisions on-farm are made to get the crop to where it is today. Questions were asked about the use of this watering system, maintenance, management and cost. I really enjoyed this talk, especially because as a Nigel is very passionate and particular about his management of the crops.
As Nigel & Jim wrapped up their talk, we jumped back on buses and took the long way around to the second station. Here we were welcomed by Mark Dawson from Monsanto and heard an update from Steve Ainsworth (CSD) along with Kristen Knight (Monsanto) about Bollgard III, Greg Constable (CSIRO) who is a leading cotton researcher based in Narrabri who discussed varieties, performance, research developments and genetics of Bollgard III. Here we also heard from Adam Kay, CEO of Cotton Australia and the work they are doing in terms of lobbying Government, promoting awareness of the cotton industry in the broader community and also promotion to the cotton industry of important issues that surround them, such as water, pesticide usage, transport of product and machinery.
We then headed back to the shed for a BBQ lunch and afternoon sessions. Jock Laurie spoke on behalf of the NFF on important issues in agriculture, the cotton industry and how they work with Cotton Australia to lobby the Government on certain issues. We then listened to Rod Fraser from NAB. He spoke on historical borrowing rates and where the market is today. What I took from this (and he expressed a number of times) was that rates are currently at historical lows, and in all previous moves off lows the major banks have started increasing rates a few months prior to the RBA lifting rates. He suggested now could be a good time to speak to your bank regarding fixation of rates.
There was a large attendance rate (I am unsure of the exact number but we filled 4 buses – a mix of coach/mini buses) and although there were quite a few industry attendees, it was great to see a large number of growers/agronomists who can take something away from the day. Well done to everyone involved in organising the day, I certainly enjoyed the day and thought it was well worth the trip up for the day.
The Upper Namoi Cotton Growers Association, held their annual crop competition tour on Wednesday 13th March. Held in conjunction was a Soil Health and Fertility information seesion, run by David Hartwick and Julian White in conjunction with the Namoi CMA. Julian and David gave a comprehensive overview of soil ecology and structure, biological and chemical interaction in the production system.
Andrew Watson hosted the first session of the day, where 2 soil pit examinations were completed showing the difference between farming system soil, and the soil in a natural pasture system along with trails of various manure, microbial and granular based fertiliser treatments. Ian Rochester gave a session on late season plant nutrition, whilst we inspected a CSD trail at Kilmarnock. At Lunch we heard from Greg Cameron, Havana Farming, on their successful integration of vetch into the cotton production system in the Lower Namoi.
The day finished up with an inspection of the UNCGA’s 2013 Irrigated Crop of the Year at “Milchengowrie”, followed by a farm tour, where he heard from Danny Jones, farm manager for PrimeAg, and Ian Carter, the winner of the UNCGA’s 2013 Dryland Crop of the Year.
Congratulations to the winners of this years Crop Competition, and thanks to Kirrily Blomfield and the UNCGA for organising another terrific day out.