Great news for Australian Farmers – There is a Global Shortage of High Quality, high value wheat. Australian Growers are in a strong position due to the low production overseas.
Demand for High Protein Wheat on the back of an expected high production will last for at least three seasons, generic Wheat prices will remain low.
Factors making Australian Wheat in High Demand.
- United States – The smallest wheat crop in a Century has been planted as Farmers turned their back on Wheat to concentrate on the high value Corn and Soybeans.
- For the US Farmers export Customers where not willing to pay the high prices asked for.
- India and Russia and more importantly China are growing larger volumes with a lower cost per hectare.
- United Kingdom – Their Wheat Crop is the smallest planted in 40 Years.
- In the UK everything that could go wrong did, dry start, very wet winter and wet during harvest.
- France – The largest European Exporter have been suffering drought conditions so the crop volumes are way down.
- With France having these problems and the demand for Wheat, it has to be sourced elsewhere.
- The huge volumes of Low quality Wheat Russia and China are growing is holding prices down for generic wheat.
China is huge factor in the Wheat Market uncertainty – How much Wheat are they storing and what is it to be used for. Wheat Storage in India is poor, kept in bags in the open which is obviously not ideal.
These factors distort the prices for Grower in Australia and the US.
The current Australian Wheat price is low at less then $300 per tonne which will reflect at the end of the Grain Harvest. With this Harvest looking like a high yield which will increase growers Profits even considering the low price per tonnage.
High Quality and High Protein wheat grown by Australian Farmers always has a high demand.