Farmgate data for 12-19 March
Every Friday, FlowNews24 and FlowFM bring you updates on your farmgate prices, including on the Country Viewpoint program on Friday afternoons from 12 noon.
The Australian Dollar was trading steadily at 77c USD, unchanged on last week and still up 30 per cent on the same time last year.
Surface water prices in the Murray-Darling Basin continue to track downwards to lows of an average $75 a megalitre, a price not seen since 26 June 2017. Volumes traded were lower this week at 60,000 megalitres traded, continuing to fall from an 11 January peak of 300,000 megalitres traded that week. Median prices per megalitre in water districts for the 2020-21 water year have been :
$208 in the Victorian Murray from Barmah to the SA Border
$150 in the Victorian Murray from Dartmouth to Barmah
$200 at NSW Murray downstream of Picnic Point, and $123 upstream
$148 at Murray Irrigation
$100 at Murrumbidgee Regulated River Water Source
The Eastern Young Cattle Indicator stand at 855.75 cents per cwt, slightly up on the last indicator, but still down 7c on last week and 10.46c down on 4 weeks. The NSW Department of Primary Industries attributes high prices for young cattle to competition between restockers and feeders. Prices remain 114c higher than the same time last year, but cattle sale volumes remain well down on previous weeks and the same time last year.
According to Meat and Livestock Australia, Vealer steers are trading highest on recent weeks, at 991c, with yearling steers also up to 881.25c. Yearling Heifer prices ar efairly steady at 802c while vealer heifers are down in recent weeks, to 871c.
Victorian prices fell significantly this week, significantly restocker yearling steers that fell a whopping 147c to 375c this week, still 36c better than the same time a year ago. All other prices fell, except a modest increase in heavy steers (up 22.4c to 408.6c) and processor yearling steers (up 6.3c, 461.7c). Those price increases strengthen Victoria's position with nation's top prices for processor yearling steers at 461.7c and heavy steers at 408.6c. Victoria also tops prices nationwide for medium cows at 292.5c, despite a 3.1c fall this week.
Warrnambool yardings were up 437 head to 1,358 with a mixed quality selection but lower prices paid. Swan Hill yardings were marginally up 49 head to 1,079 with mLA noting some 'outstanding Limousin and Charolais sired vealers and yearling calves on offer'.
South Australian prices are low across the board compared with Victoria and New South Wales. Vealer steers fell hardest, down 42.6c to 417c, while processor yearling steers (443.4c) and medium steers (383.7c) rose slightly.
Mount Gambier yardings were up to 829 on Wednesday, as were Dublin numbers, up 55 to 325 with extremely mixed quality again. Naracoorte numbers were down on Tuesday, 133 head lower to 559 with mixed quality.
New South Wales
NSW has the strongest prices in vealer steers at 512.3c, restocker yearling steers at 534c, feeder yearling steers at 447.4c.
Southern NSW has the lowest vealer steer prices (492.3c) but highest restocker yearling steer prices (627.3c, well ahead of central west on 448.7c). Prices for medium steers from Southern NSW are almost as high as the highest rated central west, (396c, compared with 397.2c).
Wagga Wagga yardings were up 635 head to 3,430 with MLA observing that weather is influencing supply, with some regions needing rain. Competition was subdued with price corrections in 'quite a few categories', with less competition from feeder buyers but restocking demand 'ramped up notably'.
Sheep prices continue to be down on last year's prices, and falling slightly this week.
As with national prices, Victorian prices continue to struggle compared with a year ago, and falling this week, with light lambs falling the most (down 57c, to 804c). This places Victoria as having the lowest prices for light lambs (804c, compared with Qld 953c) and merino lambs (717c, compared with WA 763c) but the second highest price in the nation for heavy lambs (772c, despite a slight 22c fall this week).
Western Victorian sheep prices across the board are higher than central west prices, with restocker lambs at 924c compared to 853c in central west's Shepparton, Wodonga and Swan Hill yards.
South Australian price movements were slight, with light lambs the largest improver, up 41c to 826c. SA has the second highest restocker lamb price in the nation (954c, down 28c locally on last week and up 4c on a year ago) but all other prices are in the lowest or second lowest category compared with other states.
Mount Gambier traded 866 more sheep on Wednesday, up to a 2,449 yarding among a larger field of trade and processor buyers, with active restockers seeking lambs to grow on. Dublin's SA Livestock Exchange numbers were down 1,500 head to 6,500 with extremely mixed quality. Naracoorte numbers were down 980 head to 6,021 due to less lambs and slightly more sheep.
New South Wales
Leaving aside Queensland which has very high prices at the moment, for instance 95c for light lambs, NSW has the next strongest prices on light lambs at 884c and heavy lambs at 781c. NSW comes into its own on restocker lambs with a national highest 989c and mutton on 663c.
Southern NSW has the best trade lamb (818c) and light lamb (891c) prices compared with northern and central west NSW, and close to the best price for restocker lambs at 1,003c (cf central west, 1,005c).
Corowa yardings on Monday were up significantly, rising 3,479 head to 14,149 mostly comprising lambs. MLA reports the quality was 'very mixed' and up to $14 decreases seen and further pens passed in this week.
Conversely, Wagga Wagga traded 8,600 less sheep on Thursday, down to 32,400 yarded. MLA attributes lower numbers in lambs to the decline in prices the previous week.
Grains & Oilseeds
The most recent NSW DPI weekly commodity report shows wheat steady at AUD $310/t (HR) as the USDA increased its worldwide production forecast to 776.8m tonnes due to Australa's record production. The department reports that NSW wheat prices are steady.
Feed barley prices are at $238/t, down 0.8 per cent despite what the department reports as strong world markets as Saudi Arabia purchased 660,000 tonne at an average $US279.77/tonne with Australian barley among the purchase.
ABARES reports that the latest indicators show all grain export prices were steady this week, with grain sorghum falling the furthest, down 3 per cent on the previous week to $364. Milling Wheat at Port Adelaide is down 13 per cent on the same time last year, at $361 and feed wheat at Port Adelaide down 9 per cent last year, to $359.
Canola picked up 1 per cent this week according to ABARES, to $685, up 4 per cent on the same time last year. NSW DPI observed that Canola futures markets are at historically high prices, but a shipment to China was rejected due to the presence of blackleg.
The Eastern Market Indicator continues to track upwards in a rally that began midway through 2020, up to AUD$1,300 for 21 micron. 23 and 24 micron improved the most this week, with 30 micron the biggest faller. The NSW DPI say traders and Chinese firms were the most active buyers. AWI reported that Chinese buyers were active but generally outbid in auctions:
Australia’s largest trading company continued their domination at the top, but some strong competition emerged this week from China’s two largest top makers as both were very active, albeit on separate sale days. Chinese indents were involved but quite often outbid by the aforementioned.
Elders' latest report said the market was relatively calm:
The Australian wool market didn’t fall last week, which is an accomplishment in the face of ongoing uncertainty about European demand, cash flow issues, currency fluctuations, declining wool quality and an offering initially pegged at 50,000 bales.
Overall the market indicator barely moved in Aussie Dollars, and only crept down by 6 USC, and closed marginally higher in Euro terms.
The superfine merino types continue to drift lower as the basis to 21 comes back to a more normal difference and also the quality of the greasy wool being offered is noticeably poorer. There is simply not the frenetic demand for anything finer than 18-micron that was evident in January and February, so even if the quality had been maintained arguably prices for this end of the clip would still bewaning
AWI further reports that price stability continued at recent auctions, with prices decreasing in the crossbred sector, noting challenges in the freshly shorn offerings:
The quality of the freshly shorn offering is moving towards more difficult types for buyers to place due to faults such as heavy vegetable matter (vm), type of vm and cotted wool growing in number.
These are all mainly seasonally induced wool faults due to problems surrounding management of the excessive feed in grazing paddocks following the good climactic conditions post drought in most areas.
The Elders Market outlook states that while merino wool prices in Australian dollar terms drifted sideways this week, in US dollars they drifted lower.
Expectations from the buy side has been for prices to ease, but the resilience of the greasy wool market continues to surprise, which is a nice change. From this perspective the merino market continues to track a very similar path as prices for the main apparel fibres, as is normal.
The out performance of knitwear types (short staple combing wool and cardings) continues with some very strong prices for medium/fine merino categories. Discounts for cott and colour in these types shrank this week, as exporters sought to fill consignments.
There is a nagging concern overseas that Australian growers will flood the market with farm held stocks but the experience at present is that farmer held stock numbers are stable, with some wool being sold and some fresh wool being added. Cashflows are such that forced sales of wool held is unlikely.
Reports indicate that New Zealand farmers are selling their stockpile of carpet wools down in response to improved prices, but the calculus for these wools is quite different to merino wool.
Dairy Australia reports that the global situation remains positive:
In the last months of 2020, global milk production growth started to slow. Drier weather in New Zealand and high feed costs in Europe have curbed milk flows, and smaller herds in several producing nations further add constraints this season. Whilst the US remains the key exception, reporting impressive production and herd increases throughout 2020, new supply management arrangements could slow this growth.
The outlook has picked up in the Australian market as well:
As Australian consumers continue to enjoy more relaxed COVID-19 restrictions, sales through food service outlets have improved. This is having a positive flow-on effect on domestic demand for dairy at a time when retail sales remain elevated. Sales of all major dairy products have increased in the past year, with milk and yellowspread sales rising 4.3% and 8% respectively.
The Australian Dairy Products Federation projects farmgate milk prices for the March to June quarter to be:
up to 53.09c in Western Victoria and South-Eastern South Australia, from 49.54c in the previous quarter
up for Central SA to 60.87c/L, up from $52.26 in the previous quarter
also up in NSW to 63.68c/L, from 58.13
Dairy Australia also reports that dairy production in Australia has spiked after three negative or stagnant quarters, with SA up 2.6 per cent on the year but with no increase in the January quarter. Victoria was up 3.2 per cent in the January quarter, but only 0.8 per cent for the year. NSW rose 4.5 per cent, second only to Tasmania (5.9 per cent) in the nation in the January quarter, and up 1.7 per cent in the year to date.
ABARES reports continued strong growth on dairy export prices, with whole milk powder up 21 per cent on the last report to $US4,363/tonne, and up 57 per cent on the previous year. Skim Milk powder and Anhydrous milk fat also rose, with skim milk powder up 37 per cent on the same time last year.
Hay inputs in South East SA remain at $235 per tonne, unchanged on previous weeks. Feed grain prices eased during January to $300 per tonne.