Harvest given its head
By Tyson Hosie
15th December, 2021
This past week has seen much of the East Coast return to its’ usual December programming – warm and sunny – a welcome reprieve for those looking to complete winter crop harvest, along with summer croppers who recently became involved in aquaponics…
The welcome return of constructive harvest conditions sees significant progress being made throughout the Central West and further south into the Riverina, where the headers have been given their heads, seeing incredible volumes being presented to nearby bulk handling sites.
The North West is nearing completion in parts of the Moree and Walgett Shires, and our thoughts remain with those in flood-affected areas, where favourable weather conditions are needed to persist for some time.
Over the past week, Australian wheat, barley, and canola values have been whipsawed by correcting international futures being coupled with increasing volumes being brought forward for sale.
The December USDA WASDE Report was released late last week, echoing the most recent ABARES statistics, advising that Australian wheat, barley and canola production will achieve new record production this season.
Despite the well reported impact of weather on the quality of the New South Wales crop, the production information was a catalyst for the recent pull back in values.
With the balance of the crops’ quality expected to be negatively affected, the focus is now to just get it off the paddock and into storage, be it on-farm or into a nearby bulk handling site.
Considering the delayed harvest, most counterparties are now supporting growers where required to assist with enabling delivery of forward contracts, as well as retrofitting contracts with spreads to new grades to assist with meeting obligations and mitigating potential washout costs.
The ever-present challenge of sourcing freight is also seeing an increase in depot utilisation this season, with growers enjoying the increased liquidity being afforded by the track marketing options, as well as circumventing road freight bottlenecks as borders open and potential further limitations in the New Year should the anticipated AdBlue shortages not be addressed.
And whilst we lament, in many cases, the season that could have been, there are some silver linings emerging. Given that the bulk of the Queensland crop was off before the rain commenced in earnest, there is a comparatively limited amount of genuine feed wheat available north of the border. This supports returns for off-grades and sees the drawing arc for Southern Queensland consumers reaching into parts of the Central West.
New segregations are also seeing increased competition between domestic consumers and exporters in a bid to secure desirable grade traits, with protein and falling number results as important as ever.
One thing is for certain however, and that is that we can expect plenty of volatility as harvest extends into the New Year and market pathways for both high quality and off-grade wheat, barley and canola establish themselves.
To you and yours, wishing you a safe and enjoyable Christmas period, and here’s to 2022 being your best yet!
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