Demand for on-farm grain storage ramps up
Farmers are preparing to store more grain on-farm this harvest due to flat commodity prices but canola will be sold to provide cash flow.
Lacklustre grain prices are pushing farmers to store more crop on-farm this harvest with one supplier reporting a 50 per cent surge in silo demand.
While growers say they will be storing wheat and barley due to subdued prices, it is likely canola will be sold to provide cash flow.
Canola is currently priced at $786 a tonne, wheat $365 a tonne, and lentils $620 a tonne, though farmers say the crop still needs to be harvested. Compared with last year, canola is down 2.5 per cent, wheat is slightly up, and lentils have fallen 30 per cent.
Jason Mellings who farms at Carron said windrowing of canola was about two weeks away in his area and the pods were still filling.
He plans to store grain on farm, which is common practice, however, he said it was likely canola would be sold first. Simply due to price.
“We have plenty of storage,” he said.
Lentils were usually sold directly at harvest, however, the lower prices meant that crop would be assessed at harvest.
“We will review the situation when we get there,” he said.
“At this stage the canola will go, and then we will consider whether to store barley and wheat,” he said.
In the past seven days he has received 20mm of rain which was expected to help crops in the grain fill stage.
Jeffrey Cooper of Coopers Farm Gear at Inverell in NSW said sales of silo bags were up by 50 per cent compared to this time last year.
“It is the biggest year for selling silo bags,” he said.
Mr Cooper said there were two main reasons for the sales, and the first was the fact grain prices were low.
“We are also expecting a wet harvest,” he said.
Mr Cooper said a lot of the cereal crop in Victoria had been cut for hay, however, the volumes were being made up for by a good crop in northern NSW.
“I think we will see farmers sell the canola, to provide cash flow and they will hold onto wheat and barley,” he said.
Rutherglen cropping farmer Ashley Fraser said people were prepared to store grain but there was also the need for cash flow.
He said windrowing of canola crops was still two weeks off in his area and many of the cereal crops were still green too. He received 16mm of rain at the weekend which was also helping to finish crops.
“It was a late start for us (in autumn) but crops have matured in the right timeframe,” he said.
Hamilton farmer Andrew Nagorcka said wheat was still flowering and harvest was probably at least a month away.
“We had 20mm of rain over the weekend and the moisture profile is full or close to it,” he said.
“With this soft finish things are looking OK”
Mr Nagorcka said he was planning to store cereals and faba beans on farm.
“We are considering expanding our storage or increasing storage capacity this year, especially for faba beans,” he said.
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