IKON Commodities

[IKON Commodities @IKONcommodities]

Aussie grain and oilseed export capabilities have increased massively to respond to the last 3 years bumper crops. This is to the point where the export capacity is now almost twice of what is available to be exported in an average year!

[IKON Commodities @IKONcommodities]

https://t.co/wJIsyrvgfT

[IKON Commodities @IKONcommodities]

The disruption to wheat exports from Ukraine and to some extent Russia has meant continued solid export demand from Austalia. We will likely end up exporting 28-29 million mt of wheat - this is even more than what USDA think at the moment.

[IKON Commodities @IKONcommodities]

China continue to take good chunks of Aussie wheat. Current export pace is 248% more than last year same time. In Nov/Dec/Jan China took about 1/3 of all wheat exported from Australia! Last year we did 2.2 million mt for the year - this year we have done 2.5 million mt already!

[IKON Commodities @IKONcommodities]

Aussie winter grain crop this year nudging 60 million mt now when all is tallied up and harvest over. Wheat crop is a massive 39 million mt (USDA still stuck on 34 million mt for some reason).

[IKON Commodities @IKONcommodities]

Demand for Aussie wheat from China solid. From Oct to Feb Australia has already shipped/booked more than the whole of last year. We think China may well end up taking 3.5-4 million mt of wheat from Australia this year.

[IKON Commodities @IKONcommodities]

Aussie harvest now 90%+ done, but the tail end will stretch far into January this year. Wheat crop will likely creep close to 39 million mt when we get to the end of it all...

[IKON Commodities @IKONcommodities]

Aussie harvest now 65% done and the crop keeps increasing in size. Harvest pressure is getting felt in most states as growers sell faster than traders want to buy!

[IKON Commodities @IKONcommodities]

Strong start to the Aussie Barley bulk export program with almost 1.5 million mt lifted to date (LY same time about 0.5 million mt). Like last year Saudi is by far the biggest destination with more than 0.5 million mt shipped so far (LY total was almost 3 million mt in bulk).

[IKON Commodities @IKONcommodities]

Australia has already exported close to 4 million mt of wheat in bulk so far this year (from October) so about 20 million mt more to go in bulk!! China is very much overrepresented with more than 25% going there (vs less than 10% last year).

[IKON Commodities @IKONcommodities]

Harvest is progressing very well - despite the rain and resulting quality issues in some areas. Australia is now close to HALFWAY through harvest. Crop size is still inching UP rather than down.

[IKON Commodities @IKONcommodities]

More than 1/3 of the Aussie crop is ASW grade wheat (typically 8.5%-10.0% protein and more than 300 Falling Number). Not only is this a large percentage, but given the crop size it is also about 3 million mt more than we have ever seen before!! No shortage of buyers though!

[IKON Commodities @IKONcommodities]

We have had a lot of questions around the wheat crop size this year and how big it actually is. The below chart shows this years Aussie wheat crop vs the wheat crops since 2000! This is not just a big crop, it is an enormous crop...

[IKON Commodities @IKONcommodities]

Despite the rain, and some of the downgrades to feed wheat, we are still motoring ahead with harvest. Total Aussie harvest now 34% done. We still believe the wheat crop is 37.4 million mt! (latest ABARES update 34.4 million).

[IKON Commodities @IKONcommodities]

Despite the quality issues and generally lower protein profile of the crop, it is still a BIG crop!! We think it is bigger than most other analysts think (and bigger than USDA and ABARES think).

[IKON Commodities @IKONcommodities]

How much rain is too much rain? The tables below show the latest comparative rainfall in the key grain growing areas of East Coast Australia (producing close to 20 million mt of wheat this year).

[IKON Commodities @IKONcommodities]

Australian grain harvest now 25% done, with good quality of the grain so far (although protein profile lower than average years). We will start to see rain damaged grain come in over the next few weeks on the East Coast. Crop is getting bigger than most people think though!

[IKON Commodities @IKONcommodities]

@sizov_andre

[IKON Commodities @IKONcommodities]

The latest rain will likely increase the amount of Australian feed wheat to around 6 million mt vs a "normal" 2 million mt in most years! Still a far cry from 10/11 with about 14 million! Bear in mind too that Australia feed domestic animal close to 5 million mt wheat/year.