Australian Crop Update – Week 37, 2024

2024 Current Season – USD FOB Indications

NEW CROP PRICES ARE BASED ON TRACK BID/OFFER SPREAD PLUS ACCUMULATION & FOBBING COSTS AND ARE NOT FOB PRICE INDICATIONS.

New Crop - CFR Container Indications PMT

Please note that we are still able to support you with container quotes. However, with the current Red Sea situation, container lines are changing prices often and in some cases, not quoting. Similarly with Ocean Freight we are still working through the ramifications of recent developments on flows within the region – please bear with us. 

Please contact Steven Foote on steven@basiscommodities.com for specific quotes that we can work on a spot basis with the supporting container freight. 

Australian Grains Market Update

Australian Export Update:

Ocean Freight Market Update:

The market has found its floor in the short term. Rates have stabilised for the most part and are even starting to turn the corner for some. Panamaxes bucked its recent downward spiral and ended the week in the green in both basins. More demand appeared in the Atlantic where we saw better than last done levels being concluded for transatlantic trips, while in the Pacific, owners were happy to see increased enquiry from Australia and Nopac by the end of the week.
 
It was a mixed bag on the Supramax sector. The Atlantic activity remained slow throughout the week however the rates were able to show some resistance and hold steady. Whereas in the Pacific, Supramaxes found support in Australia and NOPAC which pushed rates up 1-2kpd for pacific rounds.
 
The Handysize activity has remained subdued in both basins however there has been a clear out of prompt tonnage which has been helping to alleviate the recent downward pressure.

Going forward there is a general sense of optimism for the next couple of months before the usual Christmas slowdown.

Australian Weather:

An Antarctic blast bought a heavy frost across NSW over last few days which will no doubt cause some bullish flutters. At this stage, the crops are not stressed and are dense so we think the damage may be limited.
 
Elsewhere, weather conditions were mild and mostly dry last week. Temperatures started to climb across the northern WA cropping areas late in the week. It appears that cropping areas may not see any meaningful additional finishing rain that would offer additional yield benefits. Forecasts remain mostly dry for the next 10 days which takes us to late in September. The 16-day forecast is showing some rain for WA cropping areas at the end of September but it’s a long way off and the model forecasts have been bouncing around. Traders are saying barley harvest in southern QLD should kick off in early October and we expect wheat will be late October to early November.
 
There are growing signs Australia's most impactful climate driver, La Niña, will develop during the coming months. La Niña refers to an altered state of the tropical Pacific, lasting anywhere from months to years, when cooler-than-average waters combine with changes in the overlying atmosphere to disrupt global weather patterns. For Australia, La Niña would increase the prospects of a wet spring and summer, and to a lesser degree, potentially subdue extreme summer heat. Another La Niña this year would be the fourth in just five years — well above the average of one every four years, and a frequency only previously seen twice since 1900.

8 day forecast to 26th September 2024
Source: http://www.bom.gov.au/ 

AUD/USD Currency Update:

The Australian dollar was slightly weaker to finish last week when valued against the USD closing at 0.6688. The AUD is finding support from a hawkish tone in the latest RBA Minutes, which highlighted discussions among members about potentially raising the cash rate target. The minutes emphasised persistent inflationary pressures should lower market expectations of possible rate cuts in late 2024 at a time when the US is signalling it is about to ease rates.