May 5, 2010

AWB estimated returns on 2009-10 wheat pools hold steady

AWB's general manager of commodities, Mitch Morison, said on Tuesday (May 4) that crops among major producers in the northern hemisphere were largely in good condition.

"Spring weather in US winter wheat regions is currently very favourable, so a large US crop is expected," Morison said. "It's almost too wet in some parts of Canada, and although currently a little dry in the EU, a large crop is expected there, too."

Morison said farmers in Ukraine and Russia were hoping for rain, and the dry spell may pull back their production.

"Talk of potential sales of US corn to China has lent short-term support to wheat prices, and the market is starting to get concerned about the dry conditions in Western Australia," Morison said. "However, the market is still dealing with burdensome inventories from previous seasons and this tends to cap the scope for price rallies."

AWB shares were one cent higher at AUD1.03 (US$0.95) at 1453 AEST on Tuesday.