AgVantage Commodities Market Report 29/3/2018

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Fact of the Day – The tallest chocolate Easter egg ever was made in Italy in 2011, standing at 10.4 metres in height and 7.2 tonnes in weight. During the holiday, more than 90 million chocolate bunnies and 91.4 billion eggs are produced each year in the United States alone.

With March now over and day light savings finally coming to an end Sunday night (turn back one hour), the heat and lack of rain still lingers across the North West and Southern Downs. April is forecasted to produce some respite but for now I think we all know better than to trust these “reliable projections” on face value. With another week of mid thirty temperatures, soil moisture is being diminished day on day in what is looking like quite a decreased 2018 plant across the region. The Darling Downs south to the border as well as the Liverpool Plains look to have experienced a little more rain in parts which will give them a nice buffer in preparation of the season ahead and a better finish on Cotton yet to be picked. On the business side, the market has remained quite firm over the past few weeks and look to steady this week in anticipation of the USDA quarterly report due out before the month is out. Our dollar against the greenback has been quite sporadic by gaining less on the better days and easily finding the lows on the bad days. Today the AUD opens up just under the $0.77 mark.

Market Prices

Sorghum 1

Sorghum 2

SFW1

Chickpea #1

Del Brisbane

$340 M/A

$315 M/A

POA

Del Downs

$325 J/J/A

$300 M/A

$335 M/A

$600 April 10th

Del Narrabri

$308 M/A

$283 M/A

$295 XF A/M

$555 A/M

Del Newcastle

$335 M/A

POA

 

With the current softening trade war between America (Trump) and China (Jinping), this is putting a bit of a widening lens on the Australian grain market. Although the trade war looks to be all hat and no cattle. with many reasons not to lock horns, it still works in our favour for the time being as China will look to source more of their commodities from Australian shores, This will strengthen prices in Cattle, Cotton and especially Sorghum like we have had a glimpse of this week (up $5-7/mt). Chickpeas have bound this week by about ten dollars with some varying demand coming from the overseas markets. Though with current harvest abroad still underway and Ramadan commencing in May, there doesn’t look to be any real demand for Aussie peas in the next month or so, especially to push the price up to that seven hundred ball park.

Picking is well underway from the Downs south in to the Lower Namoi Valley, how yield is progressing is not well known for now but early reports say that growers are pleased with how the crop is tracking thus far considering the season had. Bale prices are slightly up on last week, mainly on the following seasons with 2018 at $582, 2019 $558 and 2020 at $530. With most bales being forward sold, here’s hoping more will need to be marketed due to the assumption of production uncertainty of the current season.

Happy Easter from all of us at AgVantage Commodities.

AgVantage Commodities Market Report 22/3/2018

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Fact of the Day – Yesterday was the fall equinox, this is the time when the sun crosses the plane of the earth’s equator, making night and day approximately equal length all over the earth and occurring about March 21 (vernal equinox or spring equinox) and September 22 (autumnal equinox), depending on which hemisphere you reside.

With a blistering couple of forty degree days to start the week, it appears autumn is nowhere to be seen. Dark clouds and grisly winds are about as close as the region has come to rain over the past fortnight since the last substantial fall. As forecasters expect temperatures to drop around to the mid-twenties through the border areas all the way down to the plains and experience a wetter month after the Easter weekend, it’s a tough projection to believe as recent forecasts haven’t been as reliable either and seen more as an unlikely prophecy. Grazing paddocks continue to be ruled by dust and paddocks under fallow have fertility and moisture depleting day by day. With sowing very much on the horizon too, growers must really look to current grain in hand and evaluate the likelihood of top yields again this season if this dryness continues. Though it seems to be the western areas only struggling as looking to the South East, the upper hunter across the Barrington Tops received just under five inches in an hour yesterday morning.  The Aussie dollar has been tussling with the greenback as of late and there has been some consistent movement between the $0.78 and $0.76 mark. Currently the AUD stands at $0.769 level.

Market Prices

Sorghum 1

Sorghum 2

F1 Barley

Chickpea #1

Del Brisbane

$330 M/A

$300 M/A

POA

Del Downs

$312 M/A

$292 M/A

$330 M/A

$580 A/FH-M

Del Narrabri

$302 M/A

$272 M/A

$295 XF M/A

$550 M/A

Del Newcastle

$330 M/A

POA

 

Domestic demand continues to stay firm with a lot of interest for delivery of both Sorghum grades and feed Wheat in to the Downs, Narrabri and the Liverpool Plains. Even though buyers are looking to purchase large tonnes, the criteria ranges with predominantly interest preferred for April out to June spreads. Chickpeas remain quiet as subdued demand continues throughout as Pakistan and Bangladesh focusing on solely their domestic harvest for now. The market is so volatile that bids from local packers are provided on nearly half day bases.  As bales continue to arrive to gins across the North West and Southern Downs, there is still a certain degree of bales unsold mainly due to production uncertainty this season. Weather has not helped at all in these final stages of the plant but yields will be interesting to see where they stand on previous tough seasons. Bale bids for yesterday stood at $582, 2019 $555 and 2020 at $528 with 2020 looking to be very competitive and a well-considered marketing choice in growers minds.

AgVantage Commodities Market Report 15/3/2018

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Fact of the Day – On this day in 1794 Eli Whitney, best known for inventing the cotton gin, patents the cotton gin machine revolutionizing the cotton industry in the southern US states. This was one of the key inventions of the Industrial Revolution and shaped the economy of the Antebellum South. His invention strengthened the economic foundation of slavery in the United States.

The rain has gone as fast as it arrived with temperatures to hit the high thirties once again this weekend, and here’s hoping this is the last of the heat we see till late October. Even though there was some significant and hefty falls across the NSW and SQ, there is still the urgent need for constant follow up rain in the next four to six weeks for the final development of Cotton plants, as well as regaining a strengthened soil profile for an encouraging winter crop plant. This week Australia’s wheat prices gained a little higher in the west and south coast ports though seem to have plateaued heading in to the weekend. There has also been strong talks of the continued uncertainty of the US crop. Reports have stated that the winter Wheat across the Midwest and plains has been downgraded from poor to now very poor due to ongoing weather concerns.

Sorghum has held its own over the past week and really hasn’t fluctuated at all give or take a dollar or two. The demand still is there, it is more that the selling interest is lacking on the grower side of the market. As harvest is all but done around the surrounding regions, the Liverpool plains will be underway shortly and this will bring a considerable supply in to the Tamworth and Newcastle areas over the coming months. Yesterday Brisbane delivered prices were eye-catching at $330, Darling Downs $315, Narrabri packers $300 and Newcastle market zone $328. Feed wheat and Barley are still level at the $335 in to the downs, though there is also strong bids being shown for SFW1 or better at $300/mt for January 2019 buyers call.

Chickpea demand still continues to diminish and there is not much too really touch on. India’s harvest looks to be quite impressive on the quality and quantity side and Bangladesh and Pakistan are only entering our market in short stints. Whilst India cannot export to Pakistan, we still see the demand being filled through other avenues instead of them entering the Australian market. Buyer bids are very difficult to get a gauge on as the market is still quite lacklustre to say the least. Most buyers are out of the market and this has been evident in the bids being publicised this week. Delivered Downs $560, Goondiwindi $510, Narrabri/Wee Waa $505 (at time of writing).

Cotton has softened this week from its recent highs though still very enticing when looking at pricing over the next three seasons. As soil moisture and water is the main focus, still having a rough set plan going in to 2019 and 2020 is advised, especially at the current prices being seen. Bale bids for yesterday stood at $572, 2019 $555 and 2020 at $520. Recent rain has given a positive outlook on the plants progress though as stated earlier, the next two months are crucial if there is a hope on bale yields to be as promising as first estimated. The AUD finished with a slight gain yesterday and today sits at just over the $0.786 mark.

AgVantage Commodities Market Report 08/3/2018

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Fact of the Day  With the NRL season to kick off tonight and the thought of the next immortal, best to talk about Norm Provan, the St George and Australian Test legend who played in 10 winning grand finals from 1956-65, the last four as captain-coach, as well as 14 Tests for Australia and the standing image of the current NRL premiership trophy.

Autumn is here and it brings high hopes of a wet winter. With more rain over the weekend across the North West and Southern Downs, this has given summer crops a second lease on life. For the Sorghum that hasn’t already been stripped, this last drink is set to provide a final boost in the plants final development stages. For Cotton, the soil moisture has been significantly replenished for struggling profiles and the plants for now are set to progress nicely with more follow up rain forecasted to coincide with cooler temperatures. The weekend through to Monday brought falls to Narrabri (40mm), Walgett (20mm) and Goondi (75mm), all in which falling on already moist ground. With the monthly USDA WASDE report out later this week, we can expect the markets to stay quite still in preparation of the information to be provided on global supply, demand and stocks.

Delivered Sorghum prices have jumped considerably this week and look to stay quite strong over the coming weeks. With the crop output not expected to yield as largely as first estimated, buyers on each side of the fence, domestic and export  are looking to gain some tonnes and this is what is edging prices higher day by day. Yesterday Brisbane delivered prices were fetching $331, Darling Downs $316, Narrabri packers $300 and Newcastle market zone $330, all up roughly five dollars in the past few days. Feed Wheat and Barley have come back quite firm this week with SFW1 or better priced at $338 in to the Downs with F1 just trailing behind at $335. Faba Beans are scratching the $300 mark ex-farm dependant on location and subject to enquiry. Chickpea buying demand has been at a minimum over the past week, with no international desire for now it forces the Australian packers to keep out of the market and approach buying tonnes on a day by day basis. Delivery in to the Downs is still fetching $600/mt with a price for new crop 18/19 at $570 for October/November. Narrabri yesterday sat at the $575 mark (at time of writing).

Cotton futures saw modest gains on Tuesday, though the market fell back on Wednesday due to some hefty selling. Bale prices jumped up to the $590 mark for 2018 before being reeled back in by a stronger Aussie dollar. Bale prices softened yesterday with 2018 Cotton stopping at $576, 2019 $555 and 2020 at $520. With the recent rain, plant production is forecasted to increase considerably in these last crucial months. That being said, this is possible only if there is steady rain over the next few weeks. The AUD finished with a slight gain yesterday and today sits at just over the $0.783 mark.

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