A REBOUND in the Australian dollar — up four cents from a low of below US60 cents — has pared back some of the recent gains in grain prices.

Ongoing dry conditions across Victoria and South Australia continue to dominate the limited flow of grain to domestic consumers.

Dry sowing of canola continues across the southern region, with growers hoping forecast rain over the Easter long weekend will either kick off planting or boost recently sown crops.

Despite earlier forecasts predicting over 25mm of rain in some areas, the Bureau of Meteorology now expects 5-10mm in parts of Victoria and South Australia, with Sunday showing the highest likelihood of rain.

Although better than nothing, this forecast is unlikely to provide the moisture many growers need, raising the likelihood that hectares will shift from canola to cereals.

Table 1: Indicative prices in Australian dollars per tonne.

Sorghum softens as dollar rises

The volatility of the Australian dollar has moved through into sorghum prices in the north.

From a historic low of just under US60c, the dollar jumped to a recent high of just shy of 64c today.

This coupled with rumblings that the United States and China may be ready to commence trade talks has brought back prices slightly.

Armidale-based Delta Grain Marketing broker Tom Vanzella said the sorghum values “peaked last week”.

“The sugar hit that the market got from the lower dollar and the China-US punching on has dissipated a bit,” Mr Vanzella said.

The higher sorghum prices seen last week cooled interest from some markets, according to one trade source.

“The sorghum market got to about a $375 delivered Downs a week to ten days ago,” they said.

“With last week prices at $375, it has certainly disengaged Chinese interest.”

This price fluctuation has impacted selling with some growers, particularly on the Downs, “not prepared to sell new crop with a values at the minute” as they wait to see if prices head back up.

Mr Vanzella said harvest was continuing strong in the Liverpool Plains region with growers through 60-70pc of the crop.

“The volumes that are coming off in the Newcastle zone are also dampening the market a touch.

“I think the exporters have been sitting back and watching some tonnages come their way.”

Mr Vanzella said quality was mostly holding up but there was “some Sorghum 2 segregations opened up” due to impacts from the rain.

In the Darling Downs, some patches of sorghum remain to be harvested, with certain crops experiencing sprouting damage.

On cottonseed, Woodside Commodities managing director Hamish Steele-Park said values were steady this week as the market awaits the ginning next week in the north.

“Volatility in currencies and tariff uncertainty keeping export buyers at bay – market has more a domestic influence at the moment,” Mr Steele-Park said.

New-crop cottonseed values are slightly up on last week, with ex Moree gin for May-August outturn being $415/t and delivered Downs $465/t.

In the south, ex-Riverina gins for May to August outturn are $430/t.

Sales continue slow in south, hopes for rain

While forecast rainfall totals remain modest, they’ve brought a measure of optimism for growers in Victoria and SA.

In parts of Victoria, southern NSW and Victoria sowing is continuing or just commencing without rain.

Wilken grain trader located at Melbourne, Andrew Kelso, said the dry conditions continued to dominate the trade.

“There is certainly interest in people wanting to buy wheat and barley in the back end of the year now just in case it doesn’t rain,” Mr Kelso said.

“Some of the consumers are certainly showing an interest in trying to get some coverage further out both in South Australia and Victoria.

“Quite a lot of wheat and barley is moving from the western side of Victoria and the western side of NSW into South Australia.”

Grain Focus broker at Young, Michael Jones, said that the “ex-farm market has slowed right down” with “people sitting on their hands”.

“There is some barley trading to graziers but it’s getting more and more expensive by the week,” Mr Young said.

He said that while conditions in his region weren’t as dry as elsewhere, growers had begun dry sowing last week despite less-than-ideal conditions.

“There is some canola going in dry and some it might germinate and some might partially germinate.

“No one is panicking yet, but people would just like to get into it.”

Mr Kelso said if decent falls don’t come in the coming weeks, growers would be looking to replace canola with another crop.

“If it stays as dry as it is now maybe canola will drop some acres and they’re switch to cereals and legumes in South Australia and Victoria.

“We’ll have to wait and see what happens over the weekend.”

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