READ THE FULL REPORT HERE.
Driving Prices Up
- As has been the case for a while, the ongoing dry conditions in the north of the country continue to drive demand and price. Though this is currently being expressed as a holding of the current pricing rather than pushing prices up.
- Transport costs continue to affect the final costs of fodder given the distances that the fodder needs to travel as well as the high cost of diesel and the shortage of drivers being passed on.
- There are reports that there is quite a bit of ‘over the fence’ trading going on in areas that are dry, while this does have the effect of keeping prices lower for the concerned parties it reduces the amount of fodder into the market and therefore drives demand.
- The export market is opening up with a reasonable price which is giving select producers a benchmark for their crops and removing large parcels of cereal crops for the domestic market.
Driving Prices Down
- Local green feed availability continues to keep demand, and therefore prices, stable in most of the southern areas of the country.
- More livestock producers are moving into maintenance feeding schedules in areas with limited pasture availability. A larger than usual amount for this time of year of the sheep flock is being processed as graziers lower their flock sizes.
- The cutting of hay and silage as it moves through the regions appears to be showing a rebalancing in the costs of some lines as both grower expectation and end users demand fall into alignment.
- Hay sheds continue to be emptied and therefore some lower grade, older hay stocks are on the market. This hay is of variable quality and is reducing the price point in selected regions.
- Trade in hay is increasing as the new season begins to pick up, but there is still a fair amount of this is older stock moving out of sheds to make room, or some small amounts of newly cut hay. This hay is headed into the drier parts of the country to meet demand there.
- Fires have affected parts of QLD, NSW and Victoria, as yet there are few reports of widespread damage to agricultural land.
- Exporters out of South Australia have entered the marketplace with good opening prices for cereal hay.
- The Bureau’s has declared that an El Niño and a positive IOD are underway. The declaration of these events, and their concurrence over spring, reinforces the Bureau’s long-range rainfall and temperature forecasts, which continue to predict warmer and drier conditions for much of Australia over the next three months. The confirmation of an established El Niño increases the likelihood that the event will be sustained through the summer period. Models indicate further warming of the central to eastern Pacific is likely and that this El Niño is likely to persist until at least the end of February. El Niño typically leads to reduced spring and early summer rainfall for eastern Australia, and warmer days for the southern two-thirds of the country.
Buyers are encouraged to feed test and view fodder before purchase to be sure of the quality of feed.