The merino component of the Australian wool clip fell steadily from the demise of the Reserve Price Scheme until around 2012. While the merino component of the clip does not tell us the exact proportion of merino sheep in the flock, it is a reasonable proxy for change in the flock. This article takes a look at some modelling of the merino proportion of the flock and provides some projections for the next few years.
In early March Mecardo released an analysis piece on the Eastern Young Cattle Indicator (EYCI) percentage spread/basis to the Eastern States Trade Lamb Indicator (ESTLI). This follow up article provides an update on how the relationship between the two key indicators has fared over the last six months.
It’s highly likely cereal prices will stay weak through to harvest, which will no doubt encourage holding of wheat and barley on farm and in warehouse with the anticipation of upside. If basis is weak as we enter 2017 holding grain could be profitable, but how long will we have to wait for a significant improvement?
With cereal prices in the doldrums, many growers will be intending to hold on to as much wheat and barley as they can at harvest to wait for better prices. This basically means that Canola is likely to be the cash flow crop, even more so than normal. Prices are currently pretty good, but what will heavy harvest selling pressure do to prices?
With most of the east coast in the midst of a very wet spring, many are looking for stock to make use of the grass which is growing, and will be grown over the rest of the year. Back in April Mecardo outlined the opportunity for buying Merino wether lambs in the spring for shearing and growing out. Given the big Hay sales are on in coming weeks, it’s a good time to revisit this trade and assess the value.
Last week Mecardo released an article on timing the cattle price fall for late Spring 2016 with a focus on NSW Heavy Steer prices, pointing to similarities with 2010/11 season as a guide. Previous cattle market analysis has also drawn similarities during this year to the 2005 season, so what does history suggest for Queensland Heavy Steer price forecasts leading into early 2017.
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Mecardo information is provided to assist in your marketing decisions. It contains a range of data and views on the current market. It is not intended to constitute advice for a specific purpose. Before taking any action in relation to information contained within this report, you should seek advice from a qualified professional. The information is obtained from a variety of sources and neither Mecardo nor Ag Concepts Advisory will be held liable for any loss or damage whatsoever that may arise from the use of information or for any error or mis-statement contained in this report.
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