Your Friday farmgate data (w/e 4 June)
While farmers in South Australia and western Victoria got a little rain, they will be wondering if the Bureau of Meteorology will be right about a projection this week of a wetter than average winter for most of Australia, more so on the Eyre and Yorke Peninsulas of South Australia. The Bureau is hanging their hat on a negative Indian Ocean Dipole, usually a driver for increased rainfall. Warmer than usual weather will combine with the rain to potentially lead to higher marking rates in livestock and heavier lamb weights, according to MLA.
As of Thursday evening, the Australian dollar stood at 77.23 US cents, down 12 cents on Wednesday, also down against the Euro but up against the yen and New Zealand dollar.
Southern Murray-Darling Basin prices remained steady at $90 per megalitre (ML) in the latest data. Murrumbidgee prices are stable at around $80, SA Murray up slightly to $90, Victorian Murray prices still steady at $95. NSW Murray prices fell to $90 with over 60,000 ML traded, the highest volume of weekly trade since September 2020.
The Bureau of Meteorology projected 20-30mm of rain for this week on the Eyre and Yorke Peninsulas, Adelaide Hills and north-western Riverina, and between 10 to 20mm elsewhere in South Australia, western Victoria and southern NSW.
The following week looks more promising for western Victoria at around 20-25mm, just 20-25 mm for the Yorke Peninsula and Mid-North but otherwise less than 20mm for the south-east of South Australia and north-western Victoria. Very little rain is projected for the Eyre Penisula that week.
PIRSA's Crop and Pasture report says South Australia's Upper Eyre Peninsula has limited pasture and stubble feed and most farmers are providing hay and grain for livestock or moved them into containment areas.
Most farmers reported adequate to high amounts of hay stored on-farm and livestock are considered to be in good condition across the state.
The latest Eastern Young Cattle Indicator stands at 889c per cwt, down 6.5 per cent on the day but still well above the previous year and indeed the year before. Feeder steers were up 5c to 444c, heavy steers up 6.5c to 394.5c and medium cows up 3.5c to 287c. Vealer steers recovered last week's losses to be back up to 520.9c, while processor yearling steers fell further, albeit by 2.8c, to now stand at 456.7c.
Last week's reported Argentinian export restrictions had a slight impact on the Australian market, according to Thomas Elder Markets. Australian beef export volumes remain low, albeit improving.
On Thursday Meat and Livestock Australia observed that the Australian Bureau of Statistics March quarter data showed new record carcase weights, now at 341kg for male cattle and 281kg for females. MLA observes that current high prices are providing an incentive to maximise weight gain, resulting in heavier weights.
Cattle - Victoria
Victorian prices improved across the board this week, with processor yearling steers recovering from their 21c drop last week to regain 18.5c to 473c.
Victoria boasts the best medium steer prices now at 436c and heavy steers are the top national performer at 402.7c, while medium cows continue to perform strongly and are the best eastern states price at 308.2c,
Western Victorian prices remain strong with vealer steers up strongly by 50c to 517.1c.
Swan Hill saw another limited yarding of 500 head on Thursday, with quality plainer than a fortnight earlier.
On Wednesday, Warrnambool yarded 801 head, down just 28 head, offering a large and good quality run of beef bred cows. Quality was reported to be average to good.
Cattle - South Australia
South Australian vealer steer prices continued to improve, up 31.3c to 551c this week, but all other prices fell. Processor yearling steers fell 31.6c from last week's top national ranking to now sit at 439.4c.
Across the nation, SA has the best vealer steer price on the eastern seaboard for the second week running, standing at 551.3c, up 31c.
Wednesday's yardings at Mount Gambier fell right back from last week's 615 head high, down to 397 head. Quality was reported as mixed, bringing about some mixed price results.
Whilst small numbers, SA Livestock Exchange nonetheless picked up strongly to 245 head, with well-bred pastoral bred Poll Hereford yearling steers and heifers came in from Oodnadatta and some younger Shorthorn weaners arrived from south of Port Augusta.
Cattle - New South Wales
New South Wales prices failed to take top billing compared with other states for the first time in many weeks, with heavy steers shedding 7c to 395c, conceding top place to Victoria at 402.7c
Southern NSW prices continue to be a strong performer compared with the rest of the state, with restocker yearling steers the best despite falling locally 9.9c to 538.8c. Feeder steers picked up 10c to 472c to be the state's best price.
On Monday Wagga yarded 503 fewer cattle to 2,455 head with quality 'mostly secondary' across yearling weight categories.
Dairy prices for milk powders and anhydrous milk fat all fell one per cent this week, with whole milk powder at US$4,062 per tonne.
The latest Eastern Market Indicator shows trade lambs falling further, down 30c to 798c, heavy lambs down 5c to 782c and mutton still going strong at 669c, up 4c. The big story though is the huge fall in restocker lamb prices, down a whopping 282c on the latest national indicators to now sit at 558c.
The overall falls ran against the reduction in supply, with about 30,000 fewer head traded compared with the previous week.
Sheep - Victoria
After a healthy rise in prices this week, Victorian farmers got a shock as prices collapsed (in relative terms) this week with restocker lambs shedding an astonishing 683c to 249c. Those price drops were most keenly felt in the Western Victorian saleyards, whereas central West yards reported a very healthy 940c price. Trade lambs were next heaviest hit, losing 104c to 761c. Mutton was the least affected, shedding 16c to 675c.
Horsham yardings fell further this week, seeing 1,512 fewer sheep this Wednesday for a 4,886 yarding. Quality ranged from average to good, with heavy lambs in limited numbers.
Sheep - South Australia
In contrast to the price slump across the border in western Victoria on restocker lambs, South Australian restocker lambs lifted 15c to 811c, while light lambs picked up 31c to sit at 792c. All other categories fell between 25 and 40c.
After volumes shot up last week, the Dublin SA Livestock Exchange fell back by a third in yardings to 6,000 head. Quality was fair to good with steady competition, with Merino lambs making up the bulk of the yarding.
Tuesday's yardings at Naracoorte held fairly steady at 4,999 head with less lambs and more sheep in the yarding.
Sheep - New South Wales
New South Wales improved in the national price rankings, resisting the depth of falls seen in other states to now record the best prices in light, trade and heavy lambs in the eastern seaboard. NSW has the nation's best restocker lamb price at 905c, thanks to a 92c increase this week.
Thursday's trade at Wagga fell 10,380 head to 50,000 with quality reported to be very mixed, with finish dropping away across trade and light weight classes.
Monday's yarding at Corowa rose 2,650 head to 18,150, considered larger than usual for this time of year. Heavy lambs to domestic and export processors were again well supplied with very good quality on offer.
A week ago Elders indicated a fall in the wool market, with 5.3 per cent of the overall offering withdrawn prior to sale. The NSW DPI attributed that fall to a higher supply of 19.5 to 23 micron range wools.
However, this week's figures show a 2 per cent increase to 1,343c per kilogram on the eastern market, and a similar increase to 1,385 in the west.
AWI attributes these improvements to steady demand from China and reinvigorated Indian and European buying. Stable foreign exchange rates in the major trading currencies also assisted the market.
Prices continue their generally upward trend from a low in August 2020.
AWI expects 38,674 bales to be auctioned next week.
Grains and Oilseeds
South Australia's latest Crop and Pasture report from PIRSA indicates that the 2020-21 season saw a good opening to the season, a dry early to midwinter and a hot early spring, with rains and cooler conditions for the latter half of spring providing ideal crop flowering and grain fill conditions, except for frost damage reported in some districts.
The resulting estimated 4.0 million hectares crop area was the largest since the 2013-14 season, while the final estimate of crop production for the 2020-21 season is 9.13 million tonnes, valued at $2.5 billion (farm gate) – the second highest farm gate value since the 2010-11 record of $2.7 billion.
PIRSA's report also says the Upper Eyre Peninsula has limited pasture and stubble feed and most farmers are providing hay and grain for livestock or moved them into containment areas. Most farmers reported adequate to high amounts of hay stored on-farm and livestock are considered to be in good condition across the state.
PIRSA also says that for the 2021-22 season, surface and subsoil moisture levels are low to very low across most districts, and farmers with very large cropping areas were expected to do one-fifth of their programs before waiting for more rain. Reduced demand for hay has dropped sowing for that commodity by up to 50 per cent, with pulses and canola likely to go in instead, however canola plantings were expected to be lower due to the dry May.
This week AWB sought to explain the strong global grains market with a number of international drivers, principally corn which tends to drive Australia's wheat market:
"Chicago corn futures reached to their highest levels in years, which has had a spilled over effect on wheat. China has been buying substantial amounts of US corn & beans over the last year, and with question marks over the South American corn crop, which is generally China’s preferred and cheaper country of origin for this time of year, the market predicted that US corn will continue to be in demand.
"There were also production concerns for Canadian canola and wheat, which had seen stints of dry weather. There were similar concerns for parts of the of the EU, which only further fueled speculation around international supply for this coming year.
"Then there is Russia where there was talk of significant winter kill on their new crop wheat in some regions, some analysts were speculating up to 25% in parts. On top of this, Russia has export taxes on agricultural commodities, mainly wheat, to try and control local food price inflation, which is making Russian wheat less competitive on the global market. We need to keep in mind that this tax changes in June to a floating tax.
"All the above had the funds feeling very bullish which only added to the rise in the futures values.
The global FOB Gulf Wheat indicator rose slightly, up one per cent after last week's 4 per cent fall, now standing at 1 per cent. Feed Wheat at Port Adelaide fell 2 per cent to $371 per tonne.
AWB reports prices of $253 for H2 and $264.25 for APW1 MG 2021/22 at Grong Grong, NSW, and for H1 $269 at Birchip (the best in the Victorian Mallee and Western Victoria), $258.25 at Ouyen, $268.25 at Warracknabeal and $264.75 at Wycheproof. Geelong Terminal was offering the best price at $319, followed by Werneth at $276.
Graincorp reports for H1 $283 at Charlton, $282 at Donald, $281.25 at Warracknabeal, $280.75 at Wycheproof, $278.25 at Murrayville, $277.25 at Rainbow, $276 at Hopetoun and $272.25 at Speed.
In South Australia, H1 and H2 fetched $298.30 at Mallala while H2 attracted $279.83 at Pinnaroo.
The Port Adelaide prices for feed barley rose 2 per cent to $315 per tonne this week.
AWB reports BAR1 prices for 2020/21 season of $220.25 at Birchip, $225 the best price in the district at Charlton, $222.50 at Dimboola and $216.50 at Sea Lake.
In South Australia, 2020/21 Barley earned the best central price at Mallala on $253.30, then Crystal Brook $227.39, Maitland at $219 then Pinnaroo at $216.83. Over in the west, Lucky Bay paid $310 for 2021/22 APW1 MG, with the next best price at Port Lincoln $307, Tumby Bay $299.70 then Lock at $296.75. Buckleboo prices were lowest at $283.80.
After a wild ride of late on the global and domestic markets, canola prices stabilised to fall just 1 per cent to US$672 per tonne on the Vancouver index, and up 2 per cent at Kwinana, WA to $738 per tonne. This follows a 5.3 per cent fall last week, with a high national planting but predicted lower production after a struggling start to the southern season.
AWB notes that the futures market is strong for canola and in the right conditions, a forward contract may be very attractive.
On the local front, AWB reports certified canola prices of $720.25 at Birchip, $725 at Charlton, $724.50 at Dimboola, $713.50 at Henty, $722.75 at Wycheproof and $723.25 at Warracknabeal. Prices on offer for 2021/22 are around 1.9 to 2.2 per cent higher. Hamilton was paying the best price for 2020/21 canola in western Victoria at $738. Graincorp reported $722 at Charlton, $720.25 at Warracknabeal, $719.95 at Wycheproof, $716.25 at Rainbow and $713 at Woomelang.
Graincorp reports prices of $711.50 at Rand, $710.50 at Henty West, $709.95 at Temora, $708.50 at Lockhart and $701.25 at Grong Grong.
In South Australia, AWB prices for 2021/22 Canola were $766 at Port Adelaide and Port Lincoln, $758 at Cummins and lowest at Keith $737.50.
The NSW DPI reports on the latest indicator that chickpea prices rose 3.2 per cent to $648 per tonne, firming with sporadic buyer interest. Nugget lentils are most recently priced at $900 per tonne delivered in Melbourne.
An anecdote on the fruit and vegetable front, avocados are noticeably cheaper at the supermarket, taking a heavier stumble than usual in early winter than usual.