FOLLOWING the lift in grain prices after Christmas, prices have steadied with little change since last week.
This trend toward a new floor in the market is welcomed by growers, who have become despondent with the constant tumble of grain prices since last August.
This week gairdner malting barley was quoted at $194 a tonne delivered to all three Victorian ports.
These malting barley prices are still at a $7 to $9 a tonne premium to F1 feed barley.
Small premiums between $2 and $5 a tonne can also be found for hindmarsh food-grade barley over F1 feed.
Wheat prices are unchanged to slightly firmer on last week's quotes. Exporters are bidding growers $224 a tonne for H2, $207 for APW and as high as $190 a tonne for AGP wheat delivered to the port of Geelong.
Grain exporters are unsure whether prices will continue to surge due to the well-reported dry weather affecting soybean and corn crops of Brazil and Argentina, or if prices will languish from troubled economic conditions in the eurozone and potentially China.
South American producers are convinced that the damage to their crops is substantial and have held off selling grain on US futures markets, causing a tightening supply.
Despite this, improved weather forecasts in South America last week were sufficient to shake lose sellers, who pushed prices lower late in the week.
Grain prices continue to disappoint growers and sales of wheat and barley have slowed to a trickle.
Traders believe growers have sufficient cash flow from earlier sales of canola and are prepared to hold out for higher prices. Some hope prices repeat the post-harvest lift of last year, when F1 barley jumped by $50 a tonne and APW wheat spiked $80 a tonne from harvest values to mid February.
Trade in carryover stockfeed wheat continues to end users. The SFW wheat stored in silo bags has now been delivered to markets or transferred to vertical silos on farm.
Although some grain growers are storing some of this lower-quality wheat on farm, most believe that traders own the majority of the tonnage which is stored in the central handling systems.
Lower grain prices have sparked additional demand from dairy farmers. According to stockfeed suppliers, grain prices are cheap when compared to the price of milk and most dairy farmers are fully feeding their cows.
Harvest should be completed by next week.
