Grain Brokers Australia News Archives | Page 14 of 17 | Grain Brokers Australia

Come visit us at one of the 3 main field days over the next month.

A number of the staff & team will be attending over each of the 2 day events –

1. Dowerin Field Day (Site 49)  – Wednesday 27th August & Thursday 28th August

Staff attending – Pretty much the whole office will be attending over the 2 days.

2. Newdegate Field Day (Site 18) – Wednesday 3rd Sept & Thursday 4th Sept

Staff attending – Jeff Winspear, Andy Caporaso, Kirsten Ross & our newest staff member, Mike Saunders.

3. Mingenew Expo (Site 404) – Thurs 18th Sept & Friday 19th Sept.

Staff attending – Andy Caporaso & Josh Reece-Hands (& possibly Jeff Winspear).

Latest ENSO Wrap-Up issued 29 July 2014

The latest ENSO Wrap-Up, ENSO Tracker and Climate Model Summary are now available on the Bureau’s website.

Courtesy of the Bureau of Meteorology (Issued 29/07/14).

Could the end of the Russian and Ukraine conflict be close? With stricter economic sanctions being placed on Russia the question will be is this going to impact grain flow and if so how much? As the tension between Russia and the Ukraine rises with the devastating events of last week, grain prices continue to fluctuate. In the past when a geopolitical event has escalated the markets have brushed it off and moved to higher ground. However Sunday night opening of trade saw markets fall on the lack of grain interruptions in the Black Sea region.

With both corn and wheat markets falling to four year lows last week, wheat markets responded to the tensions quickly and strongly, with CBOT Dec14 up 11.5 USc/bu Thursday (17/7/14) night to 573.50 USc/bu. Interestingly immediately after news of the crash CBOT wheat was 20 USc/bu higher but then fell away from the high as traders refocused on the bearish tone of the market with large global crop expectations.

The market is currently trading with an expectation of a large crop from Russia and exports close to 19.5Mt (USDA estimate). If export sanctions are placed upon Russia, this will have a significant impact on the global wheat market as Russia is the fifth largest exporter of wheat. Black Sea wheat is currently winning recent export business with a bid last week being offered at $35 cheaper than Aussie wheat.

The risk of escalating conflict between Russia and the Ukraine has just as much likelihood of effecting the grain market much like it did back in March, where it pushed prices to this seasons highs. Currently speculators in CBOT wheat futures are holding historically large net short positions, meaning they are expecting the market to continue to drop however they will lose money if the market rallies. Therefore if they are nervous about sanctions to Russia we could see them quickly buy back some of this exposure.

With wheat fundamentals bearish at this point in time an escalating geopolitical issue could turn the market suddenly. With current domestic markets resilience throughout the recent international sell off domestic prices may spike causing possible quick domestic selling, resulting in falling prices once more. Keep a close eye on markets to catch when Aussie wheat will potentially rise.

Kirsten Ross

Weekly Tropical Climate Note and map of Australia with Rainfall Deciles for past month (June).

Increased tropical activity over the western Pacific Ocean
Over the past week, tropical activity has been enhanced over the western Pacific Ocean, southeast Asia and the far eastern Indian Ocean. Super Typhoon Neoguri—currently impacting Japan’s Okinawa islands—is forecast to move slowly north and then northeast, making landfall over southwest Japan within the next 48 hours. Typhoon Neoguri is expected to weaken somewhat before making landfall, but is still expected to be typhoon strength on landfall.

The Madden Julian Oscillation (MJO) has become week and indiscernible this past week, with other large scale tropical wave activity influencing the weather over the northwest Pacific Ocean, enhancing convection in the region. Most dynamic climate models suggest a renewed MJO signal will develop over southeast Asia, to the north of Australia in coming days, and then move slowly eastwards into the western Pacific. This indicates tropical convection is likely to remain enhanced over southeast Asia and the northwest Pacific this week, elevating the risk of tropical cyclone development across the region.

See the Bureau’s MJO Monitoring for more information on location and tracking of the MJO.

Some more El Niño-like patterns emerge, but no El Niño yet
While the tropical Pacific Ocean surface temperature is currently at levels typically associated with a weak El Niño, waters below the surface have cooled and atmospheric patterns continue to remain neutral. However, recently there have been some small indications of an atmospheric response to the warm ocean temperatures—the Southern Oscillation Index (SOI) has fallen rapidly over the past fortnight. These changes would need to persist for several weeks in order for an El Niño to become established, and it remains possible they are simply related to shorter-term weather variability.

Most climate models surveyed by the Bureau continue to indicate El Niño is likely to develop later this year.

Hence, the Bureau’s ENSO Tracker remains at El Niño ALERT, indicating at least a 70% chance of El Niño developing in 2014.

The latest sea surface temperature anomaly across the NINO3.4 region (in the central Pacific) is +0.4. The 30-day SOI value to 6 July is –3.3.

During an El Niño, the northern wet season and monsoon typically arrive later than normal, with northern Australia tending to have lower than usual rainfall from September through January. El Niño is also associated with below normal rainfall across large parts of southern and inland eastern Australia during the second half of the year. The southwest Indian monsoon often brings less rainfall than usual during El Niño years.

See the Bureau’s ENSO Wrap-Up for official information about the current state of the El Niño-Southern Oscillation, and to learn more about El Niño.
The latest Weekly Tropical Climate Note is now available from the Bureau’s website.

Information courtesy of the Bureau of Meteorology.

The highly anticipated USDA Quarterly Stocks & Acreage Reports smashed all 3 key grains overnight with soybeans the hardest hit with a 70c drop.

1. Quarterly Stocks Report –

• High corn stock levels of 3.854 billion bushels (BBu) were reported as at 1st June, up 39% from this time last year, and above analysts’ expectations of 3.722 BBu.
• Soybean & wheat stocks were both down from last year’s stock levels, 7% and 18% respectively as at the 1st June, though above analysts’ expectations.
• Soybean stocks as at 1st June totaled 405 MBu and wheat stocks totaled 590 MBu just below analysts’ expectations of 598 MBu, and hence wheat was not sold off as heavily.

2. Acreage Report –

• Significant increase to soybean area with estimate at a record 84.8 M acres which is up 11% from last year.
• Corn & wheat planted acreages were both down from last year (4% and 1% respectively) with corn broadly in line with expectations, though wheat was up 700K acres.

Another USDA report overnight –  the USDA’s weekly Crop Progress Report – put the nail in the coffin for corn & beans.

Some key points were –

• Corn’s good-to-excellent crop condition was rated at a 10 year high average of 75% versus last year’s rating of 67%.
• Soybeans’ good-to-excellent crop condition rating came in at a similarly impressive average of 72%.
• Winter wheat good-to-excellent crop condition rating stayed at an 18 state average of 30%.
• Spring wheat’s good-to-excellent crop condition rating came in at an average of 70% compared with 68% this time last year.

The next major report from the USDA is the July 11th WASDE Report giving an update on the global crop supply & demand equation.

Til then, it would seem the bearish winds will continue to blow the key grains southwards.

Global Highlights –
The combined average temperature over global land and ocean surfaces for May 2014 was record highest for this month, at 0.74°C (1.33°F) above the 20th century average of 14.8°C (58.6°F).
The global land surface temperature was 1.13°C (2.03°F) above the 20th century average of 11.1°C (52.0°F), the fourth highest for May on record. For the ocean, the May global sea surface temperature was 0.59°C (1.06°F) above the 20th century average of 16.3°C (61.3°F), making it the record highest for May and tying with June 1998, October 2003, and July 2009 as the highest departure from average for any month on record.
The combined global land and ocean average surface temperature for the March–May period was 0.74°C (1.33°F) above the 20th century average of 13.7°C (56.7°F), making it the second warmest such period on record, behind 2010.
The March–May worldwide land surface temperature was 1.26°C (2.27°F) above the 20th century average, the third warmest such period on record. The global ocean surface temperature for the same period was 0.54°C (0.97°F) above the 20th century average, also the third warmest March–May on record.
The combined global land and ocean average surface temperature for the January–May period (year-to-date) was 0.66°C (1.19°F) above the 20th century average of 13.1°C (55.5°F), the fifth warmest such period on record.

Introduction –

With records dating back to 1880, the combined average temperature over global land and ocean surfaces reached a record high for May, at 0.74°C (1.33°F) higher than the 20th century average. This surpassed the previous record high anomaly of 0.72°C (1.30°F) set in 2010. Four of the five warmest Mays on record have occurred in the past five years: 2010 (second warmest), 2012 (third warmest), 2013 (fifth warmest), and 2014 (warmest); currently, 1998 has the fourth warmest May on record. Additionally, May 2014 marked the 39th consecutive May and 351st consecutive month (more than 29 years) with a global temperature above the 20th century average. The last below-average global temperature for May occurred in 1976 and the last below-average temperature for any month occurred in February 1985.

The average land surface temperature for the globe was the fourth highest for May in the 135-year period of record, at 1.13°C (2.03°F) higher than average. The seven warmest Mays over land have all been observed during the 21st century, with the four warmest occurring since 2010. At the hemispheric scale, while the Northern Hemisphere land areas were sixth warmest for that particular region of the globe, the Southern Hemisphere land was record warm for May, surpassing the previous highest May temperature (set in 2002) by 0.17°C (0.31°F).

Select national information is highlighted below. (Please note that different countries report anomalies with respect to different base periods. The information provided here is based directly upon these data):

Warmer-than-average temperatures continued in Australia during May, with the nationally-averaged mean temperature third highest on record for the month, at 1.62°C (2.92°F) above the 1961–90 average. South Australia had a record high average May temperature, at 2.67°C (4.81 deg;F) above average, beating the previous record of +2.57°C (+4.63°F) set just one year ago. Only the state of Tasmania had an average May temperature that did not rank among its 10 warmest; however, it was still 0.90°C (1.62°F) higher than average. Additionally, every state had both above-average monthly minimum and maximum temperatures.
In Austria, May was the first month since May 2013 with a national temperature below the 1981–2010 monthly average, at 0.6°C (1.1°F) below normal.
Spain observed a May temperature that was 1.4°C (2.5°F) higher than the 1971–2000 average. Most of the southern half of the country was 2°–3°C. (4°–5°F) warmer than average.
With records dating back to 1973, South Korea reported its highest average May temperature on record, at 1.2°C (2.2°F) above the 1981–2010 average. The average maximum temperature for the country was second highest in the period of record, at 1.7°C (3.1°F) above average.
In North America, the U.S. state of Alaska had its sixth warmest May since records began in 1918, at 3.56°F (1.98°C) above the 1971–2000 average.
Across the oceans, the global monthly-averaged sea surface temperature was 0.59°C (1.06°F) higher than the 20th century average, marking the highest May temperature on record. The previous high temperature record for May was set in 1998. It also ties with June 1998, October 2003, and July 2009 as the highest departure from average for any month on record. This record high temperature was observed as conditions, although still officially ENSO-neutral, continued to evolve toward El Niño in the east central equatorial Pacific Ocean.

According to NOAA’s Climate Prediction Center, there is about a 70 percent chance that El Niño conditions will develop during the Northern Hemisphere summer 2014 and an 80 percent chance it will develop during the fall or winter. This forecast focuses on the ocean surface temperatures between 5°N and 5°S latitude and 170°W to 120°W longitude.

Information courtesy of – NOAA National Climatic Data Center, State of the Climate: Global Analysis for May 2014, published online June 2014, retrieved on June 23, 2014 from http://www.ncdc.noaa.gov/sotc/global/2014/5 .