September 15, 2009

Wheat prices declined to the lowest level since April 2007 as favourable weather in parts of the US, China and Australia boost production amid rising stockpiles.

Above-normal temperatures in the US southern and northern plains were forecast by DTN Research on September 14. That may help speed the spring wheat harvest and accelerate planting of winter wheat there.

Global stockpiles may rise to 186.6 million tonnes at the end of 2009-10, the highest in eight years, the USDA said September 11.

Wheat futures have fallen 38 percent in the past year as the recession sapped demand for commodities and farmers expanded planting in major exporting and importing countries, curbing global trade.

Showers would increase soil moisture, favouring early winter wheat growth across growing areas in northern China, DTN said.

Argentina might see a period of heavier showers during the week, DTN added.

Global wheat output will exceed demand by 17.6 million tonnes in 2009-10 as the US, Canada, Russia and Australia, the world's four largest exporters, are forecast to expand production, the USDA forecast September 11.

Global exports will fall 14 percent to 121.1 million tonnes on-year as importers including those in North Africa and the Middle East boost production, the USDA said.

Australia, the world's fourth-largest shipper, may produce 3.2-percent more of the grain than previously forecast, the nation's commodity forecaster said on September 15.