cancel
Showing results for 
Search instead for 
Did you mean: 
Frequent Contributor

Australia's Interesting wheat position

It appears that Australia is running very low on wheat in the eastern states, nearly all domestic wheat demand comes from the eastern states. We had a good production year last year and yet we could see a situation that we run out  coming into this years harvest. We have exportorted around 15mmt this year which has meant there is little left over for domestic demand. Domestic end users seem to be playing a funny game at the moment with wheat prices not reflecting the fact that we are about out of grain. People are talking as though the lack of grain is very similar to a bad drought year. This could be to do with the now deregualted wheat market with many more exporters than the previous regulated market. It appears that the last wheat exports for this year will be leaving in the next couple of weeks, then no more exports until new crop starts hitting silos in around November.

0 Kudos
6 Replies
Senior Advisor

Re: Australia's Interesting wheat position

Nice timing for us in the PacificNW of the US. Our area is starting harvest and is rated as 7% lower production. Our stocks of white wheat are lower than normal.

 

 

0 Kudos
Senior Contributor

Re: Australia's Interesting wheat position

You might recheck your data. If wheat was that scarce, the mkt wouldn't be so dull.

I would guess somone hoisted a bunch of bull on you.

 

S hemisphere is investing large capital to expand all ag production., The wilding prices  of teh last few yrs pushed it. Capital reacts and then kind of runins itself, .

The time to expand is when prices have been at or under the COP ffor 2-3 yrs.

 

If you have land to sell, the time to sell is when you have back to back bull yrs in crop prices. 

0 Kudos
Frequent Contributor

Re: Australia's Interesting wheat position

you maybe be right, but im not so sure about it being bull. Have heard it from a few sources. Companies with rail capacity are leasing that capacity out as they are not exporting. The market can still be dull with not much grain around, for a while any way. Will be interesting to see what happens in the next couple of months here. 

0 Kudos
Veteran Contributor

Re: Australia's Interesting wheat position

sneeky

 

Is cargill big down under now?  Did they buy into the country a while back or am I not remembering correctly?

 

Thanks

0 Kudos
Frequent Contributor

Re: Australia's Interesting wheat position

They have been here a while. Have got a lot bigger in the eastern australia market in the last few years. The below is taken from their website: (AWB used to have the single desk for wheat exports)

 

In 2011 Cargill Australia acquired the AWB trading and origination arm and GrainFlow storage and handling business from Agrium.  AWB is Cargill Australia’s grain origination business, with a network 40 grain marketers in 26 locations located throughout the Australian grain belt.

Cargill Australia’s wholly owned storage and handling business GrainFlow has 22 receival sites located throughout the eastern states.  Cargill  Australia also owns three storage and handling facilities through joint venture arrangements at Henty, Red Bend and Temora in New South Wales.

 

Another recent development has been that ADM is trying to buy Graincorp (Eastern Australia's largest grain handler and exporter) It is currently in front of the government's investment review board.

 

I find it funny that we got rid of our single desk a few years ago and all that will end up happening is basically having another single desk, only this time it will be owned by foreigners

0 Kudos
Veteran Contributor

Re: Australia's Interesting wheat position

Thanks

0 Kudos