Australian Wheat Bulletin - September 2005Monday, 26 Sep, 2005
AWB, the sole exporter of wheat from Australia, has been dropping its estimated wheat prices they expect to pay to Australian farmers this harvest. Right now, they are telling Australian farmers to expect only A$146/t (NZ$160/t) delivered to an export terminal for standard 10% protein milling wheat. Long term average prices are closer to A$190/t (NZ$209/t). Australian farmers cannot make money at these prices, which will be the lowest returns since the 1990 season.
In the global markets there is a shortage of high quality, high protein milling wheats. Stocks of lower quality wheats were high coming out of 2004, and with production patterns this year, and some damage to crops in Europe and Canada, supplies of lower quality wheats remain high, while supplies of milling wheats have not been replenished.
Asking prices for top quality Australian milling wheats will be high this year, with price premiums for superior varieties which are at high protein. Depending on the types being imported into New Zealand, this may help stabilise the prices for the better quality milling wheats. Prices for lower quality wheats remain under pressure.
Globally there is no real reason for a significant price recovery overall in the short term. However, planting conditions for the northern hemisphere winter wheat crop in the US, France and the Former Soviet Union are not ideal, so there may be some recovery in wheat prices in 2006 if these trends continue.
Malcolm Bartholomaeus
Managing Director
Callum Downs Commodity News
Clare, South Australia
Ph 61 8 88422781
Email callum@capri.net.au
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