Deciding what grades to sell now and what grades you are more comfortable selling post-harvest can have a large impact on your final returns.
It is generally better to engage the market to sell grades that are in demand at the time rather than grades buyers seem less interested in.
The strength of demand for specific grades can be reflected in price spreads between grades and applying some rational thinking.
Typically, buyers who require specific quality grain will be more active in the lead-up to harvest, through harvest and shortly after harvest when supply is more available.
For example, a flour mill or maltster who requires quantities of specific grades to ensure their mills continue to operate, will likely be more active in securing tonnes around harvest.
It can be high risk for a flour miller to try to buy higher protein milling wheat grades such as APH1, APH2, H1, H2 and AUH2 later in the year for example.
Historically we would normally see the highest premiums for better quality grades of wheat and barley achieved in the months around harvest.
This is because end users are determining the quality profile of the harvest and what grades they need, and then actively securing a large proportion of their yearly requirements.
Feed buyers can be more willing to buy hand to mouth through the year because their quality requirements can be less specific.
As a result, we traditionally see premiums for better grades, and discounts for lower grades, of both wheat and barley narrow through the year after harvest.
Wheat can become wheat, and barley becomes barley, with little price differentiation between grades.
Last week H1 traded $460/t in Kwinana versus ASW1 trading at $400/t on Clear Grain Exchange as examples.
In Newcastle, where the fight for grain is stronger between food and feed users given the shortage of grain, spreads are narrower but exist just the same with H2 wheat trading $434/t track port compared with ASW1 trading $419/t.
The aim when selling grain is to achieve the highest "average price" across all the grain you grow.
Focusing on engaging the market with the grades getting strong premiums, rather than grades with large discounts, will regularly yield a better average price across your entire crop.
When you do engage the market to sell grain, be sure to offer your grain rather than selling into cash bids to ensure you get its full value.
You can offer grain for delivery in November, December, or January if needed to make selling easier.
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