March 3, 2010

Higher yields seen for Australia's wheat crop

Australia's wheat output is set to rise next season despite a marginal drop in plantings, as the country continues the trend of rising productivity following its recovery from drought.

The impact of a drop of 41,000 hectares in Australian wheat sowings will be more than offset by a rise to 1.6 tonnes a hectare in yields, according to Abare, Australia's official commodities bureau.

The increase will swell the 2010-11 crop by 284,000 tonnes to 21.94 million tonnes.

The estimate follows considerable speculation of a fall in Australia's harvest this year, as weak prices prompt farmers to cut back more significantly on sowings. But some analysts believed that forecasts were speculative at this stage and would largely depend on the timing of rains.

Still, Abare predicted that Australian growers would continue growing wheat despite the better prospects of sheep, whose prices have rebounded.

Wheat sowings would expand by about 166,000 hectares, helping production approach 25 million tonnes. Exports are projected to hit 17.4 million tonnes in 2014-15, up by one quarter on those in the current season.