CONTINUED unrest in the markets has kept prices firm for grain growers.
Wheat and barley markets are holding up well for both old and new-crop delivery, despite our dollar trading at more than US91c.
Old-crop prices for stockfeed wheat and barley eased $5 to $7 a tonne, however new-crop prices are $3 to $5 a tonne higher.
The majority of Victoria's grain growers and many in the Riverina received about 50mm of rain last weekend.
This is giving grain growers plenty of reason to be optimistic about both crop yields and prices.
Accordingly, grain growers are eager to boost yields by applying urea.
However, wet paddocks and shortages of urea have limited applications.
Agricultural aircraft have been flown in from Tasmania and the Northern Territory to assist with the demand for aerial top dressing. With the promising season, growers are also aware of the threat of rust on the developing crops.
The fall-out from the Russian drought was elevated last week when the bans on wheat exports were extended through to the middle of next year.
Due to the lack of rain, the Russians have only managed to sow about 20 per cent of their winter grain crop. With the planting window closing there is a possibility food prices in Russia will be high for the next 12 months.
Supply lines for the global wheat trade are realigning after the Russian bans were put in place.
Last week, the US sold 225,000 tonnes of wheat to Egypt and even a small shipment to a German flour miller.
Recent rain has damaged about 50 per cent of the German wheat crop. Floods have also put a halt on the wheat export plans of Pakistan.
Analysts estimate that Pakistan has lost as much as 1.5 million tonnes of wheat during the floods.
Although the world does have adequate stocks of wheat at present, the markets are sensitive to any further supply shocks.
Wheat trade around the world is watching the development of the wheat crop in Western Australia.
West Australian wheat farmers are expected to produce about six million tonnes.
The majority of the West Australian wheat crop is experiencing decile 1 rainfall this season. Last Wednesday, the rain that promised so much delivered so little.
Unless their dry crop receives rain in the next three weeks, some analysts expect that between one and two million tonnes could be wiped off their total wheat production this year.
