Last week, we saw more canola sellers come out of the woodwork as prices continued to rally, recovering to levels not seen since mid-November.
There were a number of contibuting factors, fuelled by Stats Canada reporting a three per cent decrease in expected planted area, Coceral in Belgium estimating a reduction in UK/EU production by one million tonnes, and some adverse weather striking Brazilian and Argentine soy crops.
Local South American analysts are continuing to call production much lower than the estimates by the United States Department of Agriculture in their most recent report, which is also adding some support.
While the International Grains Council, is still forecasting healthy oilseed production for the 2024/25 season, Friday's prospective planting report from the USDA will set the scene on American soy production.
With drought conditions worsening, some are forecasting a reduction in area, which will likely continue to support prices.
Sorghum harvest was interrupted earlier in the week, with showers persisting in northern NSW, southern Queensland and the Downs. With the bulk of the crop to be harvested in coming weeks, any rain will benefit the later crop without causing serious quality issues.
The $10 to $20 a tonne premium to deliver sorghum to Downs and Liverpool Plains packers continues to draw tonnes, but their capacity to handle tonnes off the header once the bulk of harvest starts will be their biggest challenge and put pressure on prices. Cheap Black Sea and Brazilian corn are keeping a lid on bulk sorghum exports from Australia.
While international wheat markets rallied last week, local prices continue to struggle.
Russian aggression in the Black Sea, and late frost and snow forecast across parts of the US have done little to help push up prices locally.
Feedlots on the Downs are increasing their numbers, but they continue to be well covered for any prompt requirements, with some buying interest starting to come to the market for May/June and onwards delivery.
Barley followed a similar story to wheat, with feedlots comfortably placed locally into the May/June delivery period; we saw some trading around the $365 delivered Downs feedlots last week.
UK/EU production is forecast to rise in the 2024/25 season, but Barley out of France, our biggest export competitor, is forecast to decrease.
Prices may be supported if China comes looking for some Australian barley in the near future.
New crop planting is just around the corner, with most on the East Coast having a better-than-average moisture profile.
A reasonable fall of rain over the next couple of weeks should see planting start in earnest.
The mix from the Plains north is set to change, with some canola area lost to the late sorghum and mungbean plantings, while high prices for last year's chickpeas will likely see them put in the rotation as this year's break crop of choice.
