ONGOING stormy conditions across southern Queensland are providing the ideal start for recently planted sorghum crops.
Weekend storms dumped 15mm to 30mm plus across parts of the Downs, with the heaviest falls across the inner Downs - Pittsworth received 34mm, Oakey 25mm and around 30mm on the southern Downs. Further north, McAlister and Chinchilla both recorded 15mm for the week.
Limited old crop sorghum is coming to the market now which has resulted in a tightening in supplies in recent weeks. Darling Downs sorghum prices jumped by $20 a tonne to $280 delivered last week as trader shorts emerged.
The rally may be short lived. Southern Queensland has enjoyed one of its best winter seasons which has resulted in huge wheat and barley crops. Stockfeed wheat and F1 barley were little changed, reflecting the overall comfortable supplies, at $282 and $258 delivered Downs respectively.
The storms have slowed the last of winter crop harvesting across Southern Queensland. Last week GrainCorp received just over 170,000 tonnes of grain into its Queensland grain storage system, lifting the season total above 900,000 tonnes.
Global prices moved lower after the monthly world supply and demand estimates report by the USDA was broadly viewed as bearish. Benchmark US and European wheat futures tumbled by around five per cent for the week after the USDA lowered its estimate of US exports to 21.8 million tonnes amid the strong global export competition. This would be the smallest US wheat exports in 44 years if realised.
Feed grain prices also ended the week lower after the USDA raised US corn ending stocks to the highest level in a decade, following better than expected yields and poor export sales. China’s corn stocks were ratcheted significantly higher as the USDA recognised the enormity of its bloated grain supplies. USDA hiked its estimate of China’s 2015/16 corn stocks by 24 million tonnes to around 114 million tonnes, which would represent 54 per cent of world stocks.
Officials in China are reportedly taking steps to curb domestic corn production after spending much of the last decade raising domestic prices to sustain food security. Not only did China’s high support prices produce a succession of record corn crops, but it also attracted record large feed grain imports as domestic buyers sought out cheaper supplies further adding to their burgeoning grain supplies.
This is not good news for Australian sorghum and barley producers as China has been the dominant destination in the past 12 months.
