Wheat values surged higher last week, with bullish inputs coming from multiple fronts.
Domestic bids jumped $20-30 a tonne last week across all zones as trade shorts lifted prices to attract sellers. Adelaide wheat bids, which have been the epicentre of the trade shorts, rocketed above $500/t delivered last week, sending a ripple effect across the country.
Stockfeed wheat jumped $25 to $460 delivered into the Darling Downs while barley was $30 higher to $430. Similar increases were seen in the delivered Melbourne markets.
Bullish inputs from the latest United States Department of Agriculture global production forecasts added fuel to the fire late in the week.
The USDA released its May World Supply and Demand Estimates report last week, which included its first global supply and demand outlook for the 2022/23 season. US wheat futures surged higher after the projected the US wheat crop came in smaller than expected a consequence of the drought in the Southern Plains HRW production regions.
Global wheat supplies were always going to be tight from the moment Russia invaded Ukraine, a move that has significantly restricted flows from one of the world's largest exporters.
This task became even more difficult after India announced it would ban wheat exports, effective immediately. A week ago, India cut its forecast for its wheat crop by 6 million tonnes to 105mt after a heat wave slashed yields. Some local forecasters are saying the crop will fall short of the government estimates.
Details of the ban remain unclear, with the government saying it would still allow exports backed by already issued letters of credit and to countries that request supplies "to meet their food security needs".
Several countries have reportedly applied for exemptions to India's ban on wheat exports. Egypt, the world's largest wheat importer, is one of those countries. India's wheat export supplies are likely to remain shrouded in uncertainty for some time.
Soaking rain across southern Queensland cropping regions will stall the remainder of the 2022/23 wheat plantings for seven to 10 days. Rainfall totals ranged from 60mm to more than 100mm stretching from Roma, Surat, St George, Miles, Dalby and Goondiwindi. Farmers are reporting that it will be at least a week before they will be able to get back on tractors.
Central Queensland also received soaking rains.
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