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Driving Prices Up
- Continuing dry conditions in parts of QLD and Northern NSW are keeping demand and prices elevated with local producers not able to meet the needs of the region, most of the demand is being met out of the Riverina, Northern Victoria and South Australia.
- Transport costs continue to play a significant role in the cost of fodder supplies, especially given the distances between available fodder supply and the current areas of high demand. There are also some export opportunities removing some supply from the market.
- Suppressed saleyard prices for cattle are continuing to keep more livestock herds on-farm, and in some cases producers are looking to restock at the lower price, which is placing additional demands on fodder supplies.
Driving Prices Down
- Green feed continues to be readily available in parts of the country which have seen favourable growing conditions, reducing local demand for fodder supplies in those areas.
- While cattle prices are seeing some producers increase their herds and therefore the demand for fodder supplies, the sheep industry is reportedly reducing the flock size even at a low return which is applying downward pressure on feed prices as herds reduce.
- Hay season is a few weeks away in parts of the country and some end users are holding off on purchases in the expectation that higher supply will reduce the cost of fodder.
- Older hay supplies continue to be made available to the market as producers clear some space in preparation for the next season. This hay is of variable quality and is reducing the price point in selected regions.
- Trade in hay is moving along, especially out of areas such as VIC and SA where green feed is still available and into drier parts of the county such as the Darling Downs and most of NSW. Any fodder being cut in those drier areas is being sold and transported very quickly to meet local demand. In WA the south is shipping a reasonable supply up into the drier northern parts of the state.
- South Australian growers are reportedly quite pleased with the recent decision in relation to the cease harvest threshold being set by the Country Fire Service for this season, as there were concerns the proposed threshold would have seriously affected the ability to bring in the harvest for both grain and hay.
- Growers and graziers in WA are seeing the value of the sheep herd continue to fall due to the ramifications of the live export trade and the follow on effects from the possible ban on the trade, with reports many graziers are planning to reduce their flock size.
- The Bureau of Meteorology (BOM) El Niño Alert continues. When El Niño Alert criteria have been met in the past, an El Niño event has developed around 70% of the time. The Indian Ocean Dipole (IOD) is currently neutral. Climate model forecasts suggest a positive IOD is likely to develop in late winter or early spring. The Southern Annular Mode (SAM) index is currently positive and is expected to return to neutral values in the coming week.
- Buyers are encouraged to feed test and view fodder before purchase to be sure of the quality of feed.