Overnight saw the May wheat contract fall 16 cents and close at 669.25cents/bushel. Corn and beans saw selling post USDA’s Planting Intentions Report earlier in the week and wheat followed suit. Corn fell 11.75 cents on the May contract and closed at 495.75cents/bushel. Beans fell 22.25cents and finished the session at 1462.25 cents/bushel.
Rain last week has provided some comfort for those looking to plant winter crops, but only in certain areas. There are still large areas across the region with uncertainty about getting a crop in the ground. Rainfalls were very mixed and ranged from 30mm at Walgett to 300mm east of Narrabri. We are hearing of full moisture profiles around Narrabri on long fallow country that has received 200mm rain, but only about 2ft of moisture on bone dry paddocks that received the same 200mm. Moree ranges but east of Moree profiles are now around 30% full and Cryon 6-8 inches in patches.
Canola will be planted in the next 1-2 weeks around Narrabri post-rain although areas will be well down on last year due to a combination of lack of moisture and poor performance in the past few years from a number of growers. For a lot of growers the past two years they have received zero in crop rain and have relied on a full profile at planting to see crops survive. They are nervous planting after this rain because there is minimal subsoil and if they have another year with no in crop falls, crops just won’t survive.
On the new crop pricing front, the past week we have seen both Brisbane and Newcastle track numbers in the low to mid $320’s track. There has been some grower selling, but more like ‘bits and pieces’ trading, not large volumes. The domestic market for new crop is very quiet at the moment, and prices reflect this. We are making some enquiries into delivered local packer multi grade options for growers as these worked very well last year, and we should have some firm pricing towards the end of this week or early next week for anyone interested.
We have demand for sorghum ex-farm or in the system. We also have homes for off-grade sorghum in the north but are struggling to find homes for off-grade sorghum coming off the Liverpool Plains region.
Demand for old crop canola is still present for any parcels in the north to head north. We are also able to price canola in the system. New crop canola has been of interest this week and we have a number of buyers express an interest to purchase new crop on an ex-farm basis for hectare contracts. We don’t have any firm values yet but as an indication around $480-485XF Narrabri, subject to oil and admix. We couldn’t guarantee pick-up off the header but for anyone who can store short-term, it would work. We should have more specific pricing and terms by early next week if anyone is interested.
Cotton futures last dropped 50 points, but traded 150 point range, the July contract has moved into carry over the soon to expire May contract. Basis has weakened with the continued strength of futures and at the risk of repeating ourselves, Chinese mills continue to remain quiet. The expectation is that their physical demand will increase as futures fall to around the 90cent level. The recent rain has caused some concern to crops and although the extent of any damage won’t be realised until pickers are in paddocks and gin runs commence, growers are estimating up to 20% yield decline and could be around 10% reduced income due to downgrades. Of course if the weather remained sunny and fine for the next few weeks quality might survive.