July 31, 2012

Australia's feed grain prices soar in July

Bolstered by developments in international markets, Australian feed grain prices increased dramatically in July.

Feed wheat prices delivered Sydney averaged US$286/tonne during July, increasing 18% on the same time last year and surpassing the US$300/tonne mark in the final week of July for the first time since the middle of October 2010.

In what is being described as the worst drought in 50 years, the ongoing hot conditions across the US Corn Belt continues to drive the rise in grain prices, while dry weather in Russia and wet conditions throughout the UK is also placing pressure on feed grain supplies.

Feed barley (US$248/tonne) and triticale (US$272/tonne) prices also rose during July, increasing 11% and 18%, respectively, on the same month last year. While the surging grain prices are great news for grain producers, the rising prices will challenge those livestock producers reliant on supplementary feed, particularly those in the lot-feeding industry.