Grain Snippet: Barley Plenty, Prices Steady: The Harvest Tightrope
Local feed grain markets have been relatively steady to firmer over the past month. As barley harvest progresses across WA, Queensland, NSW under mostly favourable weather, with early yields exceeding expectations. South Australia and Victoria harvest is well underway, though progress has been slow due to untimely rain, with some quality concerns demonstrated by an increase in BAR2/3 grades so far this year. Broad price support has stemmed from the late harvest as traders work to cover short positions for early vessels and delivery obligations. Domestic feed-grain values are similarly firmer in competition with export markets. Basis has been stronger, combined with stronger futures, offsetting the stronger Aussie Dollar. As harvest gathers pace and buyers cover their early positions, however, the more typical seasonal price pressures are anticipated.
ABARES have further adjusted their forecast barley production for the season up to a record 15.7MMT, up 18% from their September forecast of 14.6MMT, 33% above the 10-yr average, this follows an estimated 3% increase in area, and average barley yields around 29% above the 10-yr average. Looking to SA production ABARES have increased their forecast to 2.06MMT, up from their prior 2MMT in Sept, and up significantly from the 24/25 seasons drought affected crop of 1.3MMT, however still below the 5-yr average of 2.16MMT. A similar picture is painted in Vic, with the most recent forecast at 2.55MMT, up modestly from the previous estimate of 2.5MMT. Whilst the Vic barley production is anticipated to be better than the 24/25 drought affected crop of 2MMT, the lacklustre spring means it’s still slightly below the 5-yr average of 2.57MMT. These figures demonstrate the WA and NSW crops are putting in most of the heavy lifting for the record Australian barley crop.
China’s barley imports remain forecast by the USDA at 10.5MMT with imports for October ‘25 revealed at 1.1MMT above the 5-yr average of 0.97MMT. The USDA has 25/26 major barley exporters’ production pegged at 110.8MMT, up 3.1MMT m/m and up 12.3MMT y/y, with 25/26 major barley exporters’ stocks-to-use ratio 10.94%, up 1.77 pp y/y with the 10 yr average sitting at 10.27%.
Looking towards US Corn, the USDA has estimated total production at a record 425.5MMT, unchanged m/m and up 47.3MMT y/y. They also have reported a record export forecast, with total exports pegged at 81.3MMT, up 3.2MMT m/m, and up 8.7MMT y/y. The delayed export sales report revealed corn sales were roughly 40% higher than a year ago, with weekly inspection data even more impressive at nearly 70% higher. Export inspection data showed robust export demand on US corn during November and implies total shipments during the September-November quarter will likely exceed the prior record set in 2007. A subsequent modest lift in US corn futures is supportive for global feed values.
At the time of writing, 25/26 track bids sit around $303/MT in the Adelaide zone and $316/MT in Geelong, with delivered values into Adelaide $280-300/MT for harvest delivery and $300-320/MT for post-harvest delivery. With barley at roughly a $27/MT discount to APW1 (still historically tight for this stage of the season) the feed grain complex remains well-supported heading into harvest’s main stretch.
This is a sample only, if you would like to view the entire document and our recommendations, please contact CloudBreak to discuss becoming a member on (08) 8388 8084.