Australian Wheat Grade Spread Closes as Harvest Progresses in W50

For W50, the grain market in Australia has been inconsistent thus far. Deliveries to Port Kembla (PKE) for canola dropped to USD 480/MT from USD 486.10/MT (W49's price) following the weaker international market. As for the lower grade, protein wheat prices increased by up to USD 6.30/MT. Higher protein grade prices have not seen the same market demand, with an increase of just USD 3.08/MT for H2. It is largely a result of major exporters over-committing earlier in the season when the market thought we would be overrun with feed wheat due to the unusually high rainfall events. Now the market is bidding against itself to procure stock to meet its commitments. To this end, we are witnessing a tightening of the grade spreads as harvest progresses.

Grade Price (Delivered Port Kembla) Weekly change
H2 USD 285/MT +USD 3.08 WoW
APW1 USD 278/MT +USD 6.30 WoW
AGP1 USD 252/MT +USD 6.17 WoW