Northern Grain Prices Soar on Shrinking Supply and Fuel Costs

North Australian grain prices have surged due to a shrinking production outlook and expensive fuel costs. In contrast, southern prices have dropped as crop prospects consolidate and global wheat values soften.

Nearby consumer demand is modest in the south but has increased in Queensland as farmers pull down ex-farm sales and high diesel costs make it unviable to transport grain from the south.

According to Knight Commodities broker Gerard Doherty, a few barley crops have been harvested in the Qld-New South Wales border region. However, activity will not increase until next month, with chickpeas starting to be harvested this week and barley likely to follow two weeks later.

The dry finish has generated concerns about low testweights in barley and yields in wheat. Mr Doherty noted that enormous amounts of barley have been cut for hay due to poor grain-yield prospects, potentially leading to below-average yields of 2-3t/ha.