AgWatchers: Wheat Rallies, Trump Intervenes and sheepmeat warning

Wheat Rallies, Trump Intervenes and sheepmeat warning

Agricultural markets have suddenly become a lot more interesting, with geopolitics and trade policy now having a much more visible impact on grain and livestock prices.

In the latest AgWatchersX, we look at the sharp rally in wheat after Chicago jumped by the equivalent of around A$23/t overnight. Black Sea supply risk is finally starting to bite, with Russian export flows slowing and the Russia-Ukraine conflict continuing to threaten a region responsible for roughly 30pc of the world’s exportable wheat and barley surplus.

For Australian growers, the big question is what to do with the rally. The danger is shifting selling targets higher every time the market rises and then watching the opportunity disappear. We discuss why averaging up through small sales can often be a better strategy than trying to pick the absolute top.

There is plenty happening in livestock as well. Australian cattle prices are recovering despite beef safeguards in China and South Korea, while Donald Trump’s push to increase beef imports into the US has angered American ranchers and added another political dimension to the market.

That backlash could also matter for Australian sheepmeat. The US is investigating the impact of imported lamb on its domestic industry, and an adverse finding could potentially lead to a significant new tariff. With Chinese demand already softer and Middle Eastern trade disrupted, another barrier into the US would be a serious issue for Australian exporters.

Wheat is rallying, cattle prices remain strong and sheep prices are still historically good, but the political risks around all three are growing.

Listen to the full episode now by clicking below or visiting episode3.net/links