Panic buying of supplies
EASTERN Australia’s fodder market has reached boiling point as panic grips the market over where to source future supplies.
First-cut lucerne sold for $700 a tonne in Queensland last week, while Feed Central reported a baled up frost-damaged cereal crop (wheat and barley) selling for $500 a tonne.
Southeast Queensland sharefarmer Chris Morrison said he was amazed to get $210 (plus GST) for 300kg round bales of lucerne.
“I sold them to a reseller in Tamworth, who reckoned he was going to get $250 for them,” Mr Morrison said. “I didn’t think I was going to get $90 for them.”
Feed Central managing director Tim Ford, who trades fodder across the country, said there was some panic buying going on.
But the fodder specialist expected the market would ease slightly as demand eased in some areas and more fodder came on the market in October.
“We had an inch or two across the Snowy Mountains and Bathurst, where the peak of the demand has been, mostly, this winter,” Mr Ford said. “Livestock in these areas have been eating dirt, but as it gets warmer and with reduced stocking rates, (demand for fodder) will drop back a bit.”
But the Feed Central boss reckons fodder prices will still remain relatively high through spring, at $400-$500/tonne for lucerne and at least $300/tonne for cereal hay.
“Obviously if there’s no rain the market will become quite aggressive.”
Fodder specialists say supply is the major issue, given:
● NSW’s cereal crops have failed to germinate or don’t have the bulk to bale this season. In past droughts, such as 2006-07, these crops have been a valuable source of supply.
● Zero general security water allocations in the NSW Murray system mean many irrigators are unable to bulk up and bale cereal crops.
● High grain prices mean Victorian grain growers facing dry seasonal conditions are holding on to cereal crops in the hope of producing grain.
● Temporary water prices have hit $350-$370 a megalitre, prompting fodder growers to think twice about buying water.