Australia: AWB cuts estimated pool returns for malting barley on increased Argentinean offer on the global markets

Undercutting of barley markets by Argentina has pushed AWB to cut its estimated pool returns for the grain by $5-$8 a tonne.

Pool returns for Baudin, Gairdner and Bulloke malting grades have fallen A$5 a tonne to A$250 a tonne, while the Hindmarsh pool has dropped A$8 a tonne to A$245 a tonne.

AWB's Richard Williams said Argentina had a record barley crop and was very aggressive in Middle Eastern markets, selling below Australia barley values.

"There is also reduced demand for feed barley in Australia and Europe as competitors are aggressively pricing feed wheat as a substitute for feed barley into the domestic and European markets," Mr Williams said.

"Barley malt premiums have been reduced by up to A$15 a tonne as the Chinese market is focused on buying lower quality feed barley as the market is over supplied with quality malt barley.

"The global barley supply situation remains tight and will need good crops in Europe and the Black Sea region to supply the market for the second half of the year.

"However, we will be looking to target barley pool sales on possible weather induced price rallies during March to June.”

07 March, 2012