Stronger dollar continues to hamper Aussie grain demand

Stronger dollar continues to hamper Aussie grain demand

Agribusiness
Recent Australian dollar movements as tracked by Profarmer.

Recent Australian dollar movements as tracked by Profarmer.

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A stronger Australian dollar continued to hamper demand for Australian grain last week.

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A STRONGER Australian dollar continued to hamper demand for Australian grain last week.

The dollar's rise is making Australian grain less competitive in global markets at recent grower trade values.

Hence the surge in demand for grain as the $A fell and pushed Australian grain values higher, had largely dried up last week as many exporters stepped to the sidelines.

Some domestic buyers also appeared to be content to sit idle after accumulating some cover in the recent run up of prices and/or possibly getting offered grain by the trade and/or were possibly just happy to wait.

This resulted in a quieter week of trading last week as buyers were having to pull bids back, while growers were happy to be patient holding their offer prices.

Many growers seem comfortable with cash flow after selling more grain during the recent lift in prices if they had some remaining and are focused on getting the new crop in.

Just 12 buyers purchased grain through Clear Grain Exchange last week which is the lowest so far this year and indicates how difficult it was for markets to come together.

However, there were more buyers searching for grain on offer which signals there was more interest in buying grain, just not at the prices offered in many cases.

Despite the difficult conditions grain was trading, though the activity was sporadic and unpredictable.

Hence make sure your grain is on offer rather than waiting for a bid and then trying to react to it.

If your grain is not on offer it does not have a chance of trading at the price you want.

Barley was the main commodity where price ideas aligned on both sides to trade.

Feed demand continued to underpin that market across the southern States though malt was attracting premiums over feed of about $15 a tonne in the west ($325/t FIS Kwinana traded) and $15/t or better in Victoria ($323/t Geelong traded).

Wheat demand was very specific however those parcels trading were achieving strong prices relative to best public bids.

The chart above shows examples of trades last week versus the best public bid.

More information: visit cleargrain.com.au to view recent trades on the exchange or call 1800 000 410.

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