December 12, 2005

Australian 2005-06 wheat exports to rise a little

The volume and value of Australian wheat exports would rise a little this fiscal year ending June 30, 2006, in part reflecting increased production, the government's chief commodities forecaster, the Australian Bureau of Agricultural and Resource Economics (Abare), reported Monday.

Wheat exports this fiscal year are forecast at 16.15 million tonnes valued at A$3.55 billion, compared with exports of 15.78 million tonnes valued at A$3.49 billion the previous fiscal year, it said in its quarterly Australian Commodities outlook publication.

Australia is a major global exporter of wheat, through monopoly exporter AWB Ltd.

"Total imports by Australia's four key markets, Indonesia, Iran, Iraq and Egypt, are forecast to rise in 2005-06, providing an opportunity for Australian wheat exports to increase to these markets," it said.

Abare reiterated a new crop production forecast of 24.1 million tonnes, up from 20.4 million tonnes previously. The harvest is underway and expected to finish early in calendar year 2006.

Gross returns to Australian farmers from the new crop, based on AWB's benchmark export pool price for its collective sales, are projected to rise to A$202/tonne for the new crop from an estimated A$199/tonne from the old crop, it said.

Abare forecast the price of the indicator US hard red winter wheat, free-on-board Gulf of Mexico, to average US$161/tonne this fiscal year, up from US$154/tonne the previous fiscal year, reflecting lower production in four of the major exporting nations.

For this fiscal year, Abare projects world production at 610 million tonnes, consumption at 616 million tonnes, closing inventories at 131 million tonnes and global trade at 109 million tonnes.

For the previous fiscal year, it estimated production at 623 million tonnes, consumption at 613 million tonnes, inventories at 137 million tonnes and global trade also at 109 million tonnes.