Global Weather Market
By James Urquhart
27th May, 2024
It’s a bit cliché to break the ice by talking about the weather, but it’s almost all the market is actually talking about. It’s a bona fide weather market at the moment with a number of important grain and oilseed producing origins around the globe under close scrutiny, including Australia. The heightened level of uncertainty, aided by a relatively low Aussie dollar, is being reflected in local markets, with prices for most commodities improving to more historically palatable levels. With growing confidence in production throughout most of NSW and southern QLD, growers are taking the opportunity to continue the marketing of their old seasons grain, whilst some also embark on the coming seasons program, albeit with a small percentage of their estimated production.
Canola markets here have been on an impressive and sustained rally since about the end of March, when funds were caught short amidst a Chinese buying spree. The market did a lot of work to cover those short positions but in the meantime, flooding in parts of Brazil’s soybean crop and a waterlogged European rapeseed crop has added ongoing support. New crop pricing for delivery into the Newcastle crush plant has gained nearly $100 over that time, homing in on the $800 per tonne mark.
Whilst it has been on the radar for a while, concerns over the Russian wheat crop started to exert a greater influence on markets last week. Production estimates for the world’s largest exporter of wheat have declined following persistent dryness and severe frosts through major wheat growing regions. Crop forecasts are varying but sit somewhere in the low to mid-eighty million tonne range, which compared to last season’s 90-plus million tonnes, is a sizeable reduction. At these levels, Russian production remains higher than the 5-year average, however with the nearby weather forecast not offering much reprieve from the prevailing warm, dry conditions the market may soon be working on a Russian wheat crop of less than 80 million tonnes.
While it’s Russian weather that has dominated the headlines of late, there remains a couple of other meteorologically themed stories unfolding that will undoubtedly have a bearing on the market. In northern Europe there are some regions, notably France, where crop estimates are shrinking under excessively wet conditions, and there is a strong chance of further crop cuts to come in these parts.
In the US, rainfall throughout the Hard Red Winter wheat growing regions will cap any further production cuts to that crop which had previously been under a cloud of uncertainty. In fact, the latest crop tour results out of Kansas points toward a better crop than average. Here in Australia, the market has started to dial back production estimates based on dryness through parts of the country. However, the current forecasts look promising for rain late this week, which would go a long way toward solving the immediate moisture deficiencies across Western Australia, South Australia and Victoria and hopefully signal a return to a wetter weather pattern going forwards. Fingers crossed.
Global Grain Markets

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Read MoreTechnology aids decision making

With Summer coming to an end and Autumn upon us, growers along the east coast have turned their attention to the 24/25 season and are beginning to put their cropping plans in place. With commodity prices fluctuating more than ever, the decision-making process around how growers decide to sow which crops, has become one of great interest..............
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Read MoreFortune favours the prepared

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Read MoreUS grain report hits Australian prices

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Like it or not, rainfall has been the order of the day for many parts of the country with winter crop still to harvest. Various locations through Southern New South Wales, Victoria and South Australia have received up to 200mls in the last couple of weeks........
Read MoreRain turns the tables on summer crop plantings.

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Storm conditions have provided welcome rainfall to areas of Southern Queensland and Northern New South Wales. With rainfall totals between 15-50mm in the last week and some areas receiving more than 100mm........
Read MoreHarvest progresses at record pace

The Aussie winter crop harvest is about halfway toward completion, with plenty of grain still on the stalk in the southern parts of Western Australia, South Australia and New South Wales as well as the bulk of Victoria.......
Read MoreWA Market Wrap

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