Barley demand kicks prices up

Export barley demand kicks prices up


There has been an improvement in barley values post-harvest, driven by strong export demand.

There has been an improvement in barley values post-harvest, driven by strong export demand.

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Strong demand from key export markets has seen barley prices quietly rising post-harvest.

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IT WAS very much out of favour at harvest last year, with prices dropping below $100 a tonne delivered at some up-country sites, but barley has mounted a comeback of sorts.

ProFarmer analyst Angus Thornton said feed barley prices had rallied by over $33 a tonne since the harvest period.

It has represented a solid win for growers who held onto feed barley stocks, even allowing for warehousing and interest fees.

The rally has centred on an unexpected surge in demand.

Feed barley exports continue to fly off the docks, with shipping stems still booked with further shipments.

James Maxwell, Australian Crop Forecasters, said Australian barley exports almost doubled year on year over the October - March period according to Australian Bureau of Statistics (ABS) data.

This season there has been 5.9 million tonnes of barley exported against 3.2mt in the first seven months of the 2015/16 marketing year.

Mr Thornton said demand for Australian barley had been spread across a range of traditional and emerging markets.

“A resurgence in demand from our more ‘traditional’ barley trading partners of Saudi Arabia and Japan has combined with nearly four-fold growth in export volumes to China year on year,” he said.

He said it had led to the stronger than expected export program.

However, the improvement in pricing has not been dramatic enough to spark an increase in plantings even when combined with a forecast for a drier than average season in Australia, where barley often outperforms other crops.

In its Australian Crop Report issued this week, the Australian Bureau of Agricultural and Resources Economics and Sciences (ABARES) dropped its predicted barley plantings by 4pc year on year to 3.9 million hectares.

Production is forecast to decrease by a whopping 39pc to 8.1mt, an estimate largely based on a substantial drop in average yields per hectare from last year’s record levels.

Current old crop feed barley values vary between $190/t in SA to $155/t delivered upcountry sites in central NSW.

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