Feed grain prices drop as world stocks grow

Feed grain prices have dropped up to $15 a tonne in the past month as global and domestic production impacts local demand.

Feed grain prices are dropping on the back of big world supplies and a potentially good crop in parts of NSW and Western Australia.

Feed grain prices have dropped up to $15 a tonne in the past month as global and domestic production impacts local demand.

And while those buying feed grain to supplement livestock production could still have big bills on their hands, costs do not look like rising anytime soon.

A bigger than expected wheat crop in the United States, combined with predictions of big US corn yields, have taken the sting out of feed grain prices world wide.

On Monday, there were listings on the online grain trading platform iGrain as cheap as $340 a tonne on farm for maize, $275 a tonne for barley, $305 a tonne for wheat and $450 a tonne for lupins as trade starts to slow.

Clear Grain Exchange trade operations manager Tom Taylor said there had been a steep fall in feed grain prices since June.

“Prices, especially for barley, seem to have plateaued in the past week or so after reaching a high point in May,” Mr Taylor said.

He said international factors were dampening demand for feed grain, and the turn in the season with rain across NSW and parts of Western Australia had meant the impetus to buy was soft.

“Domestic buyers felt no need to jump up to buy feed grain,” he said.

Reid Stockfeeds commodity manager Justin Fay said feed wheat and barley prices had crept back about $10-$15 a tonne during the past three to four weeks.

“Victorian cereal markets have been relatively subdued over the last month,” Mr Fay said.

“While trade volume has been steady, there hasn’t been the level of volume going through as seen in previous months and market prices have traded in a tight range.”

He said there had been more farmer-to-farmer trade due to the lack of rain in parts of Victoria, as producers worked to keep stock condition strong in light of the green drought.

Overall, feed grain prices had come back, he said, (feed barley currently trading at about $335 a tonne and feed wheat $350 a tonne), but anyone looking to boost rations using pulses was finding the rates had risen thanks to strong demand to export to the sub-continent.

In its commentary on the market, Elders said global feed grain prices were being affected by the incoming crop in the US, where a big corn crop “will create a drag on the global grain complex”.

Australian feed grain producers look better placed, the commentary said.

“The reopening of the Chinese barley market has left Australia with low carry-out stocks, local feedlots are full and some prefer barley particularly in summer months, while crops in large barley growing areas in southern Australia are less than ideal.”