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.