Barley defies global markets with price rise

World grain markets have tumbled but local markets are encouraging growers to sell a number of commodities. See what’s up this week.

Taking a hit: Global grain prices are weaker and consumers are gaining some relief from lower wheat prices. Picture: Zoe Phillips

AFTER sustaining a consistent rally in prices, global grain and oilseed markets open this week lower.

While consumers will gain some relief from lower wheat prices, canola prices are stable, and barley and pulses are higher in southeastern Australia.

In the six weeks from the first week of December, wheat futures rallied $29 a tonne in Paris, $38 in the Black Sea and $52 a tonne in Chicago.

Steep rallies lately have been based on the yet-to-be confirmed additional taxes that are anticipated on Russian wheat exports.

According to brokers this rally has created much interest from speculators. Based on the fundamental market support of dry weather impacting the summer crops of corn and soyabean in Argentina and Brazil as well as the underlying price trend for cereal grains and oilseeds, many were long wheat, corn and soyabean.

To sustain these positions, further bullish news is needed but last week traders’ appetite for risk subsided as broader markets such as oil dipped.

With this uncertainty and some better than expected rain in South America, traders tended to sell and take their profit.

In the Chicago exchange, corn futures fell $15.80 and soyabean fell $49.90 a tonne. Winnipeg canola futures followed suit falling $52.90.

In wheat futures, Chicago fell $19.50, Paris fell $8.75, the Black Sea futures lifted $6.50 and the ASX contract lifted $7 a tonne for the week.

However, the ASX market closed on Friday before the news of the falls during the northern hemisphere trading and prices fell at least $6 during trading on Monday.

Local barley markets bucked the trend of inter­national markets. Brokers quote the delivered user market in Melbourne for BAR1 grade barley at $261 a tonne up $9 and exporter bids are up $5 a tonne to $242 delivered Geelong less freight to silos.

A barley tender for Saudi Arabia is being held at present. While 730,000 tonnes were contracted for January and February shipment, only 480,000 tonne is called for in the March and April tender.

Although field peas and faba bean prices remain unchanged this week, lentils are up $20 a tonne, desi chickpeas $25 and Kabuli chickpeas are also $30 a tonne higher.

A shortage of shipping containers has impacted the trade of pulses to the sub-continent and Middle East.

To maintain market share, exporters are shipping in bulk; 24,000 tonne of faba beans and 42,000 tonne of lentils are scheduled for shipping from South Australian ports during January and February.

MORE

CROP FORECASTS: AUSTRALIAN WHEAT PRODUCTION SOARS

WESTERN AUSTRALIAN BARLEY EXPORTED TO MEXICO FOR FIRST TIME

AUSTRALIAN WHEAT A BARGAIN AS KEY GRAIN SOURCES STRUGGLE