September 8, 2010

Australia's wheat export prices to rise further
 

A surging demand for Australian wheat could mean a continuing increase in export prices and grains exporter group AWB predicted an increase in the prices of various grades of wheat between AUD9 (US$8) and AUD22 (US$20) a tonne.

Speculations of a tightening supply of wheat from the USDA data increase wheat futures 1% to as high as US$7.485 a bushel on September 8. Futures have climbed 75% since June. Russia's ban on wheat exports until December has driven the prices to a two-year high of US$8.68 last month.

AWB general manager of commodities Mitch Morison said, "''This means there is very strong interest for Australian wheat, both to make up for the lost volume in the global trade and supply higher-quality needs."

"The interest is helping to generate better prices for Australian wheat on top of the general improvement in world prices, so we are in a strong position talking to customers about shipments both in bulk and containers," Morison added

Despite the floods in Victoria, production prospects are still high. The winter crop harvest has begun in central Queensland.

Australia is the world's fourth-largest supplier of wheat. According to the Australian Bureau of Statistics (ABS), the country is exporting 52% more wheat than last year. Wheat exports reached 1.59 million tonnes in July. Only 1.05 million tonnes were exported last year.