There’s loads of hay being delivered into flooded areas of North Queensland and fire-affected components of Victoria. This could imply that offer for the common markets is weaker and costs needs to be steadying.
Within the final week we’ve seen the alternative, based on Dairy Australia’s weekly hay worth report. Determine 1 reveals pasture hay costs in South West Victoria and Central NSW have continued their lengthy decline from winter peaks and are actually again on the similar worth as this time final 12 months.
East Coast pasture hay costs are additionally now equal to these in WA. This implies that the hay provide squeeze is over and inventory has been replenished. We’ll learn how replenished shares are if autumn fails once more, however for now feeding inventory has turn out to be an inexpensive prospect once more.
One commodity which isn’t cheaper is barley. Robust export demand has feed barley priced at or over $300/t at east coast ports (determine 2). Barley costs are just like this time final 12 months, regardless of declining world feed grain markets.
Feed barley can also be promoting at near feed wheat costs. Feed wheat is mostly increased in vitality, which implies it trades at a $20-40 premium to barley. With barley presently near parity with feed wheat, it makes for good promoting for barley and good shopping for for feed wheat.
Barley can also be good promoting relative to corn. After the USDA report lifting forecast corn shares, CME Corn futures fell 4.5% again to October ranges. In our phrases, CME Corn is priced at $258/t, which places barley at a $35-45 premium; that is robust by historic requirements.
