GRAIN markets are firmer on the back of fewer farmers selling at the moment.

Wheat for stockfeed compounders in Melbourne is $5 a tonne higher at $195 a tonne for general-purpose wheat, while ASW is quoted at $200 a tonne delivered to the Melbourne user.

Export prices are also about $6 a tonne higher.

Grain growers are focused on sowing crops and less on selling grain.

Sowing of cereals was well underway in the Mallee and Riverina until the locust swarms hit over the past month.

As some newly emerged crops were devastated by locusts, growers have been understandably reluctant to continue sowing, particularly in the Riverina.

Locust sightings have diminished in the Elmore-Rochester area.

But the continuing mild weather in the southern Mallee creates an ongoing locust threat to crops.

Canola planting is the key crop of interest at present in the Wimmera.

The oilseed crop is proving popular given the early rains and favourable prices for canola.

New-crop canola prices have been above $420 a tonne for delivery to Victorian ports in December.

Compared to wheat, canola prices have held up well in spite of the improved world supply of grains and oilseeds in the last year.

When comparing the prices of January this year to those of January last year, canola prices are 22 to 25 per cent lower and wheat prices are 30 to 33 per cent lower.

International values for oilseeds have fallen in the past few weeks.

Forecasts of large soybean crops in South America are yet to reach shipping positions and some investors have moved out of the grain and oilseed markets.

Investors have been attracted to the high interest rates offered to assist in rescuing the debt laden southern European countries such as Greece, Portugal and Spain.

Recent sales of Australian wheat to Iraq signal a return of competitiveness for Australian wheat.

The late April tender was awarded to 100,000 tonnes of Australian wheat and 250,000 tonnes of Russian wheat.

Traders also report successful sales of Australian wheat into other markets throughout the Persian Gulf area over the past five weeks.

Closer to home, sales of Australian wheat have been assisted by higher shipping costs.

Wheat from Black Sea ports of Europe are less competitive now into South East Asian export wheat markets.

Perhaps a critical supply and demand report from the US Department of Agriculture this week will provide some direction to markets.