December wheat futures overnight ended 6 cents lower due to a weakness in corn and beans which pressured wheat also. Reduced demand from Indonesia due to a weakness in their currency, along with reports that Russia’s yields are higher than expected also added to the bearish tone overnight. Corn also closed 6.25 cents lower. Open Interest has dropped some 70 000 contracts in the past two sessions and traders now feel that short covering is now filled. The focus on the corn markets is that there is a hefty supply, and that South American weather remains favorable to crop development and ideas that the USDA will raise production estimates in the next WASDE report, due early December. Soybeans were unchanged overnight with mixed news. US exporters reported sales of 360 000mt of US beans to an unknown destination, but at the same time China cancelled a shipment of 300 000mt. This cancellation has traders nervous that China could potentially cancel more US beans into the New Year period as they believe they have over committed and also if South American bean values continue to decline.
Locally, chickpeas have been of interest this week and they have traded this week at $392 delivered Moree, and $398-400/mt delivered Narrabri. Prices on a delivered Downs basis have been between $410-413, depending on delivery period. AgVantage are still accepting chickpeas into Agripark for warehousing. Current prices at Agripark are well above values for peas in the system. Faba beans, by large remain reasonably flat in both demand and price.
We have strong interest and competitive demand for new crop sorghum delivered Narrabri, Newcastle, Brisbane and on an ex-farm basis from the LPP through to border regions. Values delivered Newcastle today are around $280-283/mt delivered and ex-farm Gunnedah/Curlewis is around $240XF. For anyone looking to price new crop sorghum, please give us a call. This past season there has been large volumes of sorghum trade on a delivered Narrabri basis into the packers as Chinese demand this year was previously unseen. This gave growers around Narrabri, Bellata, Wee Waa and even growers from Gunnedah an alternative to putting grain in the system. We believe that this will again be a strong alternative to growers and we do have prices for delivery into packer for new crop sorghum.
On the wheat front, the scattered storms across the region over the weekend has really had little effect on prices. Lower grade wheat values remain well supported and growers are continuing to be active sellers. Currently there is demand for most grades in the system with buyers still being selective on what grades they are chasing. If you have 3-4 different grades in the system, chances are there will be 3-4 different buyers also. Given today is the 27th, please be reminded that for some growers, particularly in the north that warehousing fees will kick in this Sunday, leaving only a few days to price and transfer prior to these fees if you so wish.
We have also seen durum values ‘pop’ in the past week and growers south of Narrabri with durum in the system have achieved $300+ site. Now we know that most would like to see more of a premium for durum but from what we are hearing, Aussie durum values are still $30+ above Canadian values into competing destinations. DR2 values are around a $25-30/mt discount to DR1 and DR3 values a further $20-25/mt behind DR2 values. On-farm durum is difficult to move if you are looking to move prompt and for anyone looking at a delivered Gunnedah option, it would be for a July delivery.
Cotton futures have risen over the past couple of sessions and prices today are above $460/bale. Long-term outlook remains fairly flat and futures today for the March contract are around 79cents/lb. The decline in our Dollar is providing support and a drop under .90USD would be nice to see. Recent rain has provided some relief for growers across parts of the Namoi Valleys, however those in the MacIntyre, Gwydir and Macquarie Valleys are still watering to keep crop development progressing.
Please keep in mind when speaking to AgVantage or perusing the prices on our bidsheet that we do not charge you, the grower a fee for our services.