Australia

[agstar77]

Australia has undercut U.S. corn feed equivalent by 50 dollars per ton, with feed wheat, on a sale to China. I presume Viterra would be a possible seller.

[charliep]

Perhaps you can help me with a question? I was talking to a US feed buyer yesterday and highlighting our $5/bu ($185/tonne) feed wheat prices. He commented that these prices adjusted for freight were well under the price he was paying for US corn. If the opportunity presented itself, they would be a buyer of Canadian feed wheat.

Is feed wheat moving the US? Why or why not? Are the current CWB 200 % EPO values (goofy I know but effectively a cash price) reflective of these sales opportunties? If there is extra money/profit from these sales, where does it go or is it redistributed to everyone via the pooling system? What impact on the domestic feed market?

Perhaps to highlight, Viterra and the CWB have something in common. They are both big grain companies that look after their business interests.

I will highlight it is very unusual for China to impact wheat (particularyly feed). Suspect the CWB/Canada should be accessing this market as well. South Korea is the only market I am aware for feed wheat. The domestic market needs competition.

[charliep]

Will note their local corn price was close to $6/bu ($240/tonne).

[charliep]

Apologize for monopolizing the conversation but it gets my imagination going.

Current US Portland corn prices are USD $12.85/CWT or about $280/tonne. Current 200 % feed wheat EPO is $235/tonne ish in store. Add $15 for fobbing (loading a boat) and you have $250 or a $30/tonne discount to US corn prices.

[furrowtickler]

So, is corn in for a correction? This would be my bet, b/c there is way too much feed wheat in world supplies in realation to high quality wheat imo.

[malleefarmer]

Agstar can give you a honest answer but would suggest not vitterra, they are buying little grain, there cash prices are way down and pool estimates are lower than anyone elses, so hardly anybody delivers to them.
AWB and a Company are running well priced feed pools. Frieght costs could have been a plus for australia.
Current cash prices for feed wheat at farm gate are $190 to $200 per tonne.
This equates to roughly $285 FOB or loaded on the vessel, then frieght on top.
AWB in a media release about 5 weeks ago said they were making "good but steady" sales to china

[malleefarmer]

Plus another one from the newswires is and feel free to disagree, Australia is uniquely placed to supply super high quality feed wheat this year as it higher in protien,less small grain and absence of weeds etc compared to normal years when our feed wheat is shit out of the bottom of the barrel.

Myself have delivered tonnes and tonnes of feed wheat if not for the sprouted grain would have H1 wheat the best quality you can get over 13% protien high test weight and low sceenings.

What price were the sales done at does anybody know?

[charliep]

alberta feed wheat prices Cdn $175/tonne delivered elevator or $195 ish for higher end stuff delivered direct to feed mill/livestock feeder. CWB 200 % EPO will provide a delivered elevator price of $185 ish.

Feed wheat quality everything from soup to nuts. Frozen hard kernels, sprouted, stained, light bushel weight, etc., etc., etc. Lots of feed quality durum which the Koreans will take.

[agstar77]

So if Australian feed wheat is so good, why are they discounting?

[charliep]

I am doing my homework on current prices but you seem to have them at your fingertips. What are the current prices for landed China (CIF) Aussie feed wheat and US corn? Source?

[charliep]

will note that malleefarmers numbers don't support what you have said. Aussie $285 equates to USD $280 - very similar to current portland corn prices.

[agstar77]

Report came from Jody Lefcourt Bunge grain services.

[malleefarmer]

Agstar not agreeing or disagreeing as nobody knows the price or the deal but seems to me its not discounted at all, its about the inherant value of feed wheat.

And nobody knows it could have been priced signed and sealed tw o months ago for all we know when prices were lower.

Good topic of discussion, latest estimates of feed wheat in australia has it 38% of total crop.

The marketers here due to our proximity to asia and se asia were going to have a head start in sales and japan is almost totally australias market.

We will take it while we can get it as you know as well as i if the black sea counrtys were exporting then we would see some serious undercutting.

[malleefarmer]

someone could also anwser this question, in dollar terms when accounting for protien and energy were is the best bang for buck corn or wheat? When feeding to stock.

[charliep]

In Canada, energy levels similar (particularly hog rations - have to get into a discussion of metabolizable versus digestible energy and species but that confuses the hell out of me). Protein corn 8 %, wheat 12 % Canada. Feed wheat should be worth 5 to 10 % more but depends on species. Market determines and most often same price here.

What I can gather, the Aussie business was done at about USD $260 fob. Add $25 to $30 ish ocean freight. CIF price - $288 ish.

US corn gulf - $283 ish. Freight China - $45. Landed price - $328.

CWB pricing ideas for business would be about half way in between Aussie feed wheat and US corn. Theory because they are not doing the business.