Site Logo
  • AWB Login

    AWB Login

    • AWB Website Registration
    • AWB Accountant Access Registration
  • Daily Grain Prices

    Daily Grain Prices

    • GrainFlow site Prices
    • Delivery information
  • Products and Services

    Products and Services

    • Market Advantage (NPE)
    • Multi Grade Contracts
    • Fixed Grade Contracts
    • VICTORY® Specialty Canola Program
      • VICTORY® Canola Hybrids
  • News Hub
  • GrainFlow
  • About

    About

    • Jobs
  • Admin

    Admin

    • Reporting
      • Ask AWB Reporting
      • Account Link Reporting
      • Grower
    • Account Link
      • 3rd Party Access Administration
      • Maintain Accountant Details
    • Ask AWB Administration
    • Assume User
    • GrainFlow Grower Portal
  • Cargill
  • Contact Us
  • Account Help
Home//News Hub // Sorghum crop a circuit breaker for the market
  • News Hub

Sorghum crop a circuit breaker for the market

Warren Lander, AWB

With the lowest rainfall amount from January to August for NSW since 1965, it's helped achieve an unwanted statistic for total winter rain 54 per cent below average. This has resulted in a winter crop forecast of around 3.9 million tonnes, plus severe frosting that arrived in the first week of September, has led to us seeing a domestic grain purchase price of $430 a tonne plus ex farm.

It’s also created a somewhat tiring and character building year for many.

With huge demand for east coast grain, a basis of $211.30/t has formed, helping create a $465/t Port Kembla track price. As we know, the further we go with out rainfall, the more crops will fail, resulting in crops being grazed or made into hay thus creating higher grain prices on the east coast. 

The only circuit breaker here will be rain in the north for farmers to plant sorghum.

Sorghum crop a circuit breaker

In all of this we continue to hear the noise coming out of the US about the size of its corn and soybean crops, reports indicate that corn yields could average 12.19t/ha while soybean yields could be 3.5t/ha. 

Inclusive of these excessive yields, throw in the trade war against their biggest customer China and you would think American growers will look to spread their risk and start to grow more wheat due to the strong prices even with a world increase in production of 3.3 million tonnes this year.

 

As we all know, there is always a positive point in difficult situations and today that is wheat futures, pricing opportunities that we are currently experiencing have not been around since 2008 and we do not know how long they will last for. 

By looking at futures it will allow a plan to be formulated to capture momentum in the market through flexibility while fixing the basis at a later date when production is secure. Current price of AWB December 2019-20 futures price is 287/t - this is a great starting point by any means and by acting well in advance better prices could be achieved.    

Farmers by nature are optimistic. 

They always believe next year is going to be better and I am quite sure that’s what's on the mind of a farmer right now, obviously dependant on where their farm is located!

They will manage their business on what will and won’t work for them and there is no better way by talking about what price you could achieve or at least by investigating the options. This is a great way of getting more control and becoming a price maker instead of price taker when the grain arrives in 2019.

 

Originally published 19 September, 2018

For further information call the AWB Grower Service Centre - 1800 447 246


Fertiliser costs hit the hip pocket

Fertiliser costs hit the hip pocket

In Australia, “The amounts spent on fertilisers in general are the largest single variable cost for grain producers, and are 15-20% of all cash costs, or 20-25% of variable costs,” according to the International Plant Nutrition Institution. 

Read More

Your grain, your cash and a reliable partner

Grower Operations Team

For the 2017/18 season, AWB recorded a payment performance of 99 percent on time, that is, we’ve paid 99 percent of payments within their contract terms. 

Read More

New longest train record set as grain heads to drought affected north

New longest train record set

A new record for the longest train in the history of the ARTC network has been set. The train is 1.8 kilometres long and 102 wagons in length, pipping the former record of 101 wagons. 

Read More

Look forward to the futures for marketing opportunity

Look forwards to futures_img

To take advantage of 19/20 prices there are a few different ways you can tackle it, you could sell a multi-grade, locking in both local basis and futures, or you could look at a swap locking in futures only.

Read More
Useful links Terms & Conditions
Privacy Security Website Terms of Use
© 2022 Cargill Australia Ltd trading as AWB ABN 42 004 684 173
Was this page useful?