Australian Crop Update – Week 43, 2024

Australian harvest progress pressured Australian cash markets last week. It was a dry week which is allowing more farmers to start harvest. In addition, USD values for Australian grain were helped by a softer AUD. 
 
Wheat and chickpea values were softer with harvest pressure in Queensland (QLD) and northern New South Wales (NSW) which is showing better than expected yields. There are plenty of reports of wheat yields in the north above 4t/ha and even larger barley yields. Early reports from southern QLD and northern NSW have also showed good amounts of APH13 and AH12 which is pressurising protein premiums. However, it is still early days in terms of the wheat harvest with QLD progressing well, NSW 10 percent done, and Victoria (VIC), South Australia (SA) and Western Australia (WA) just getting started. It is certainly too early to make a call on likely grade splits but the yields being seen in the north make us more confident that the wheat crop will come in well over 30 million metric tonne (MMT) despite smaller crops in the south.

Australia’s prices for chickpeas delivered to QLD sites have fallen by up to USD150 per metric tonne (/MT) in response to harvest pressure, and India’s continued absence from the market. This is despite it removing its tariff on chickpeas, which was expected to prompt a fast and furious shipping program bookended by the start of the QLD harvest and the closure of the tariff-free period on 31 March 2025. Trade sources say Pakistan has emerged as the destination for the first two new-crop cargoes shipped this month from QLD, and that prices have now fallen to a level expected to attract buying interest from India and Bangladesh, as well as Pakistan. Trade sources say the price drop has occurred in response to volume selling from growers at higher rates. With around one third of the Australian crop forecast at 1.5-1.7MMT now harvested, the trade is now confident that volume to supply prompt shipment cargoes is available.
 
Elsewhere, the northern fava bean crop is being bid up by some export shorts and the southern crop is getting some early support by some who are concerned about a smaller crop however rain last week was helpful to the VIC crop at least. 

It was a tough week for owners in the Pacific and Indian Ocean last week. Tonnage lists began to grow from Monday and with little fresh cargo hitting the market, it didn't take long for the sentiment to turn negative and rates to start contracting especially for Handysize where many owners had to start entertaining lower than last done levels to get covered. Southeast Asia and F East were noticeably quiet as rates dropped $1-$2kpd across the board for Handies and Supra/Ultra. The Panamax sector followed a similar trend in both basins – subdued seemed to some up the market nicely.
 
More new crop wheat, barley and canola was added to the shipping stem in the past week, but it was all in WA. This comprised of 240 thousand metric tonne (KMT) of barley, 170KMT of wheat and 55KMT of canola. The increased wheat volume suggests exporters are connecting with Asian buyers at current values particularly in the lower protein grades. However, the softness in the cash markets indicates volumes are modest which makes this commentator think talk of Chinese import interest is mainly focused around barley. There was also 30KMT of chickpeas added in central QLD.