Southern Queensland sorghum values continued to firm last week crops feel the brunt of the dry, hot January weather. Sorghum production estimates are falling with the unfavourable finish, but quality may even be a greater concern.
Although southern Queensland escaped the brutal heat seen in south-eastern Australia last week, average daytime temperatures across the Darling Downs regularly climbed into the high 30s last week which is around 4 degrees hotter than average. Well above average temperatures and dry weather has rapidly taken the shine of promising sorghum crop.
Sorghum values continued to strengthen last week as traders factor in a smaller than expected crop. Farmers were hoping for well above average yields after the widespread mid-December rains, but potential has suffered with the testing January weather.
Quality of the southern Queensland sorghum crop is now shaping as another major hurdle for farmers. Screenings has emerged as a significant problem in the early harvesting in the Condamine and Meandarra area. Farmers are saying a lot of crop has more than 20pc high screenings which is incurring hefty discounts.
High screenings levels in the early harvested crops has some farmers struggling to reach the quality levels of early sorghum No.1 sales.
Sorghum was $5 higher last week at $365 delivered into the Darling Downs for No.1 quality while the No.2 sorghum around $330 to $335.
Quality remains a concern for crops that will be harvested where crops have suffered with the lack of a finishing rain in January. Sorghum heads have not fully filled as the crops run short of moisture, and this is expected to result in high screenings.
Barley values drifted lower last week as global markets continued to soften with the uncertainty over Chinese demand. Feed barley from WA was being offered at $390 last week.
Barley traders are becoming more circumspect about further Chinese imports after Beijing initiated an antidumping investigation into Australian imports. China has been the major destination for Australian barley exports in recent years, accounting for 60 to 70pc of total exports.
China’s total barley imports have plummeted in recent months. Recently released customs data showed that China only imported 580,000 tonnes of barley in the October to December quarter down from 1.9 million tonnes in the corresponding period a year earlier.
Australian’s barley exports are expected to improve in January as exporters hurry to execute existing contracts to China to minimise exposure to possible sanctions that may be imposed by Beijing, under the wide-ranging measured offered to them by the antidumping investigation provisions. However, traders are concerned about future sales to China needed to shift WA’s record large barley crop.
WA barley prices fell $10 to $298 Free in Store Kwinana last week. It was the first-time prices have fallen below $300 since the antidumping investigation was announced in December.
Global grain futures have traded in tight ranges in recent weeks amid the absence of regular USDA inputs with the partial shutdown of the non-essential government services. News that President Trump has agreed to reopen the government services is expected to be supportive as traders will discover how much grain the United States has sold for exports in the past six weeks when the USDA services resume.