Drought be­hind 70% grain price rise

Warwick Daily News - South West Queensland Rural Weekly - - News - Ni­cola Bell

GRAIN prices are up to 70% higher com­pared with the same time last year.

De­spite drop­ping slightly on pre-Christ­mas rates, Aus­tralian do­mes­tic wheat, bar­ley and oat prices have been driven up by the sig­nif­i­cant drop in pro­duc­tion due to drought.

Rabobank se­nior grains and oilseeds an­a­lyst Ch­eryl Kalisch Gor­don said glob­ally wheat prices were up about

20% year-on-year and 70% do­mes­ti­cally, while world bar­ley prices were up 25% and

70% lo­cally.

“They are stag­ger­ing in­creases and it shows the drought deficit. If you look at wheat year-on-two-years prices are up 100 per cent,” Dr Kalisch Gor­don said.

She said glob­ally there had been a tight­en­ing of sup­ply, which was keep­ing prices high.

“We think in the sec­ond half of this year when more north­ern hemi­sphere wheat comes on to the mar­ket, prices will drop back,” she said.

Do­mes­ti­cally, Dr Kalisch Gor­don said it would de­pend on what hap­pened with the sea­son in March–April.

“Prices will prob­a­bly stay pos­i­tive un­til har­vest 2019 be­cause stocks are so low,” she said.

On Mon­day Aus­tralian Premium White wheat was sit­ting at $442/tonne, de­liv­ered Mel­bourne, com­pared to $265/tonne last year – an in­crease of 67%.

Malt 1 bar­ley was mak­ing

$385/tonne, de­liv­ered Mel­bourne, up 45% on the

$264/tonne last year, while feed 1 bar­ley was at

$390/tonne, up from

$248/tonne last year, or 57%. Milling oats was sit­ting at

$502/tonne, com­pared to

$205/tonne at the same time last year — an in­crease of

144%.

Canola prices were also higher year-on-year do­mes­ti­cally, de­spite be­ing flat glob­ally, sit­ting at

$609/tonne.

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