South Australian grain prices fell again last week as the pre-harvest price bubble continues to deflate.
Port Adelaide APW values rocketed to $430 in early October at the height of the drought.
Traders were betting that large volumes of South Australian grain were needed to fill the massive supply void for domestic markets in the wake of the worst east coast drought in more than a decade.
But prices have been heading south ever since. As it turns out, the east coast crop came in a little better than expected, thanks to some late spring rains, while the pre-harvest spike made South Australia’s wheat and barley too expensive to compete into export markets.
Port Adelaide APW price fell by a further $6 last week to $367, now down more than $60 from the highs reached in early October. Eyre Peninsula values have also fallen.
Port Lincoln highs for APW of $382 were reached in early October and prices have since fallen by close to $40 to $345.
Markets were showing signs of stabilising early this week.
Part of the steadying in prices may have been due to emergence of on-farm grain feeding in Victoria and New South Wales which was offering some partial support to values.
Paddocks are becoming progressively bare and brown again as the dry, scorching conditions in January and early February take their toll which has forced some farmers to revert to feeding grain, again.
Australia’s wheat exports picked up in December as recently harvested crops in Western Australia started to be shipped.
Australia exported 721,000 tonnes of wheat in December up from 308,000 tonnes in November.
More than one million tonnes of barley were exported in December as exporters work to get as much shipped to China as possible to limit exposure to the anti-dumping investigation.
