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Demand for Australian wheat is significantly reduced due to cheaper offers from CIS origins into the SE Asia region. Futures continue to be trending lower everyday due to very competitive offers from Black Sea origins and an anticipated heavy northern hemisphere grain supply. However, since last week we have seen increased market demand from SE Asia flour mills – market participants figure the market now at or about to be at bottom. Forward purchasing intentions upto Jul/Aug shipment periods have been seen. APW1 yesterday quoted at sub U$275/mt – $280/mt levels; APH2 at U$335/mt levels to CFR SEA major ports.

Australia red sorghum is experiencing stable demand in China, with SOR1 trading between U$287-290/mt to major ports. Australian Sorghum crop looks to be larger than anticipated given good in crop rain, crops maturing well and sound quality. At this stage we expect Sorghum crop to be north of 2 mmt given the large planting in Central Queensland. ABARE report next week which will reflect crop forecasts.

Mung beans also seems to be growing well given ideal conditions of soil moisture and are quoted at U$975-980/mt to CFR Qingdao for April/May shipments.

Bit of demand now flowing into Kaspa/Dun peas from China and Bangladesh as a result of India extending duty free period for YP. Some business been done into China par/sub U$410 levels CFR China major ports and U$440 +/- into Chittagong.

Australian barley containerized business & bulk in vessel are trading at U$250-255/mt levels to CNF China major ports. It has remained sideways these values now for past 2 months. Barley is in good availability in Australia due to lack of domestic and export markets but China demand is lower/flat.

Pakistan’s market is experiencing slow demand for Australian red lentils and desi chickpeas as buyers have completed Ramadan purchases and awaiting shipments arrival. Recent trades of NIP1/HAL1 at U$690/mt levels to CFR Karachi in containers with small continuing demand. A bulk vessel also reported enroute which may impose price pressure on local market. Desi chickpeas demand from Pakistan remains quiet.

Indian domestic rabi crop harvesting is accelerating, leading to a slow demand for Australian red lentils, with forward cargo trading at U$685/mt levels to CFR Kolkata in containers as per market sources.

In Nepal, there is no significant trading activity for Australian lentils, Desi chickpeas, and Canola. We heard trade offers for NIP1/HAL1 at U$725/mt levels to CFR Birgunj in containers. Some small quantities of Canola seed have traded $570+ levels CFR Birgunj for Mar/Apr period.

In Egypt, market demand slow for Faba beans, as we heard trade offer at U$480/mt levels to CFR Damietta in containers. Longer transit from Australia(90+ days) as container vessels transit via Cape to Europe and reroute back to Damietta and USD availability in Egypt have hit recent demand as northern hemisphere faba supplies will kick in May/Jun onwards. A couple of bulk faba vessels yet to load ex Australia for which domestic Victoria accumulations bids are strong and thus keep containers from being offered at competitive values.

AUD/USD at the 0.65 mark is helping forward export business commitments, however we are witnessing slow demand from destinations across all commodities.

Australian east coast sub-soil moisture is good at this stage and Western Australia has also seen recent rain events – this has lifted grower planting intentions for the winter crop. Mar/Apr planting rains will be crucial to deliver a good crop planting. ABARE forecasts awaited next week 05Mar24.

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Regards

Australia harvesting of 23-24 crop has started with barley and some pulses already harvested in QLD/NSW& SA. VIC should start in a weeks’ time. Canola is being windrowed and harvesting will start with earnest in the next week. Wheat will be next. We should see an early harvest this season and should see all crop in the bin by end Nov/early Dec in the eastern states.

WHEAT:

Currently Australian wheat is still trading at a premium due to domestic market premiums in QLD/NNSW region as a result of feed demand.

Asian destination container market for wheat has started buying some Australian wheat for Nov/Dec period with demand for APW at sub USD305 pmt CFR SEA ports and ASW sub USD 300 pmt levels.

Exports of Australian wheat declined by 18% in bulk & 1% in containerized business. Indonesia, China, Vietnam are volume importers in bulk wheat & China, Thailand, Taiwan are top importers in containerized wheat in August as per ABS.

BARLEY:

As harvesting begins, Australian barley market remains relatively stable over past week. Feed demand in QLD/NNSW for deferred deliveries into Dec/Jan period is still strong and at A$100 premium to VIC markets. Harvested barley currently also showing good quality and making Malting grade – with a premium of A$40 being paid by buyers.

Exports of Australian feed barley down by 11%; Top importing destinations are Japan & Vietnam. While exports of malting barley increased by 23%; Top buyers are China, Mexico & Vietnam. Currently with Russian barley at around USD 260 pmt into China, Australian barley in containers remain uncompetitive into China which should change upon harvest pressure in a few weeks.

SORGHUM:
Exports of Australian sorghum is declined by 2%; China top buying destination in August per ABS.

In China, after long weekend mkt is opens up. Australian sorghum unable to find export parity against cheaper US sorghum.
PEAS

In China, no trade demand for KASPA Peas against cheaper Russian yellow peas that is traded at USD 355 pmt levels.

DESI CHICKPEAS:

Exports of Desi Chickpeas increased by 137%; Pakistan is major buying destination followed by Nepal & UAE in August as per ABS.

In Pakistan, at present market demand continue to be slowing down for desi chickpeas. They have adequate stock in the pipeline which should take them through till end of Nov. We are observing local market is struggling get going for CHKM as price at USD 480 pmt equivalent levels in local Karachi mkt, buyers thus abstaining from making any further purchases. As we heard the CHKM is offering at USD 570/mt (Oct/Nov) to CFR Karachi with no buying interest. PKR currency has been firming up last 2 weeks.

Bangladesh demand for desi’s is limited and sporadic with payment issues still keeping sellers in risk off mood for the destination. Pricing/offers have corrected almost USD 100 pmt from peak, though we expect Bangladesh to still participate in purchasing in next 45 days to build adequate inventory for Ramadan festivities.

Due to limited demand in export markets, Australian domestic bids have evaporated with only pipeline business being covered by exporters/traders.

LENTILS:

Exports of Australian Lentils increased by 16%; India is top buyer followed by Bangladesh & Sri Lanka in August as per ABS.

In India, we are observing some trade activities at destination market for Australian red lentils & this week prices have softened by U$30-35/mt. We heard Nipper/Hallmark#1 traded at U$700/mt to CFR Kolkata (Dec/Jan). We see consistent buyer bids at USD 680 – USD 690 pmt levels CFR to Indian ports which is parity business currently. However, with lower Indian stock levels but with an adequate import pipeline, any further upside may only be limited to Rabi crop issues if any going into harvest in March,24.

FABA BEANS:

Faba beans have started harvesting in QLD/NSW/VIC & SA. Consistent bids to growers to upcountry packers around A$440 pmt to $470 pmt levels for export – significant part of crop is also expected to be stored on farm for drought feeding in face of El Nino threat. Supplies seem adequate with goods yields being reported.

Consistent demand from Egypt at USD 450 pmt levels CFR Damietta for FAB1, we also observe market offers at U$410/mt levels to CFR Kolkata though.

CANOLA:

Exports of Canola declined by 15%; Volume buyers are Japan, EU & Mexico in August

For Australian GM canola to Nepal no export price parity against Ukraine rapeseed that is offering at USD 550 levels vs Australian parity sitting at USD 620+

Disclaimer: Prices mentioned are for indication purpose only

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