United States Department of Agriculture confirms tighter global and US ending stocks

Restricted supply from black sea and poor crop conditions in north America and Europe have been known, monitored, and priced in by the market for some time.

The most recent new information was the United States Department of Agriculture confirming tighter global and US ending stocks in their recent WASDE report, and the Indian wheat export ban.

Both saw the Chicago Board of Trade (CBoT) wheat market react by surging higher.

Last week CBoT wheat grinded lower for most of the week as rain appeared on forecasts through the US, and the full details of the Indian export ban revealed "some" grain will continue to move.

By the end of the week some buying kicked in again to keep CBoT wheat trading just above technical support levels.

The weaker CBoT wheat market set the tone for Australian buyers taking a more cautious approach.

Rather than continuing to chase the market higher to secure tonnes, buyers were more selective on parcels and careful on price expectations.

On the offer side of the Australian market growers were generally holding their offer prices on grain listed for sale.

READ MORE:

Many growers and grower agents were also offering their grain for sale at the recent price highs achieved, noting that they feel Australian grain remains competitive internationally at the price they're asking.

Some APW1 in Port Adelaide managed to trade a $562/t port equivalent price late in the week.

Hence Australian wheat values have not reflected the recent losses in CBoT wheat, just as they didn't reflect the full upside when CBoT wheat was surging.

However, demand has cooled, and prices have slid lower from the highs made recently for the moment at least.

Where it goes from here is anyone's guess.

In other commodities, warehoused feed barley was making $455/t Port Adelaide, $440/t Kwinana, $447/t Geelong and $453/t Newcastle. Malt grades that traded were attracting better values.

Canola traded $1,116/t in Port Adelaide plus oil bonifications and $1,068/t in Melbourne.

For growers considering making sales. Demand for warehoused grain can be difficult to predict so make sure you engage all buyers with an offer price.

For those that have finished selling old crop and looking at new crop sales, be sure to consider the most appropriate method to sell.

Australian grain remains competitive into international markets and in an enviable position to supply the world.

This won't last forever.

Everyone is trying to work out how long it will last.