E-Malt.com News article: 3312

Australia: ABB Grain Ltd announced on September 22 that ABB’s forecast 2004/05 season gross barley pool indicator has increased $5/t for malting barley to $170-180/t, while the gross feed barley pool indicator remains steady at $135-145/t.

ABB managing director Michael Iwaniw said that there had been a small spike in feed barley prices due to a hold-up in supply through logistical problems in the Black Sea area, as well as the purchasing of wheat by the Ukrainian government. Barley prices however were still under pressure as a result of the enormity of the crops just harvested in the European and Black Sea countries.

“As one of our main competitors, the Black Sea region is a market that ABB watches closely. Barley produced in this region for the 2004 season has been harvested under adverse conditions, however there is still around 5 million tonnes expected to be available for export,” Mr Iwaniw said.

“Most of the European feed barley crop has been harvested under excellent conditions, however rains during the latter part of the harvest has caused damage to malting barley and wheat crops. This will result in more feed grain being available in the market, adding further downward pressure to market prices.

“Another of our major competitors, Canada, has experienced frosts of late which have resulted in significant quantities of barley being downgraded to feed quality.”

Mr Iwaniw said that the firm freight rates that remain in place were another factor still impacting barley prices.

“With these activities occurring in the international feed barley market, It is unlikely that we’ll see an improvement in Australian dollar prices for 2004/05 feed barley at this stage,” he said.

Meanwhile, Mr Iwaniw said that malting barley prices were remaining firm for now.

“2003/04 malting barley is attracting high premiums over feed barley and to date has not followed the sharp downward turn that feed barley prices took,” he said.

“Supply and demand for the 2004/05 season malting barley is finely balanced given the damage to some of the Canadian and European malting barley crops; however, with the significant difference between feed and malting prices there is a risk of second grade malting quality barley entering the markets. If this happens malting barley prices could drop closer to feed barley prices.”

Mr Iwaniw said that low protein remained an issue for buyers who were requesting 10% protein on their contracts. As a result ABB was seriously considering lifting its minimum protein level to 9.5% from 9%. Growers will be advised when a decision is made on this matter.


22 September, 2004