Wheat pool demand rises

AWB ‘s early season pool, which opens for contracting next week (June 20-24), is expecting a 25 per increase in tonnes from growers who are looking for cash alternatives for their 2016-17 crop.

“We forecast 25pc growth in our early season pool this year, on the back of a challenging 2015-16 price environment,” he said.

“Growers are seeking another way to market their grain because the price outlook has been and continues to be so disappointing.”

Mr Brown said growers had spent six months holding onto grain waiting for a better price opportunity.

“Holding and hoping was a failed selling strategy. They won’t put up with that pain again for this season,” he said.

With Australian wheat stockpiles growing as global demand continues to be weak, early season pools are proving attractive to growers looking for pricing opportunities.

“An early pool gives growers exposure to two volatile offshore pricing periods plus also the whole price environment from when your crop is in the ground until six months after you have harvested,” Mr Brown said.

In the recent lower cash price environment, an early season pool offers growers exposure to opportunities in both the 2015-16 and 2016-17 northern hemisphere weather markets – plus the whole Australian season and still be finalised by the end of the financial year.

Growers are also looking for cash flow and payment advances, which can be critical to alleviate financial pressures for growers at this time of year.

“The interest in our early season pool Season Starter is also due to generally good crop conditions across the wheat belt and on the back of proven performance, having outperformed the average equivalent best cash bids for APW across the three seasons it has been offered,” Mr Brown said.

“A lot of growers tell me that it sure beats watching the market for 12 months themselves.

“It also gives the grower a benchmark price to compare to when selling their uncommitted grain post harvest.”