December 18, 2006

Australian wheat exports to fall in 2006-07

The volume and value of Australian wheat exports will fall this fiscal year ending June 30, 2007, reflecting lower production due to drought, the government's chief commodities forecaster, the Australian Bureau of Agricultural and Resource Economics, reported Monday.

Wheat exports this fiscal year are forecast at 12.79 million tonnes valued at AUS$3.07 billion, compared with exports of 15.17 million tonnes valued at AUS$3.30 billion in the last fiscal year, it said in its quarterly Australian Commodities outlook publication.

Australia is a major global exporter of wheat through monopoly exporter AWB Ltd. (AWB.AU).

While production will slump to 9.7 million tonnes this fiscal year from 25.1 million tonnes previously, a drawdown from stocks will help meet export demand, while higher world prices will help moderate a fall in the value of exports, it said.

Abare forecast the price of the indicator US hard red winter wheat, free-on-board, US Gulf of Mexico, to average US$208/tonne this fiscal year, up from US$176/tonnes in the last fiscal year, reflecting lower production in some major producer nations.

For this fiscal year, Abare projects world production at 587 million tonnes, consumption at 607 million tonnes, closing inventories at 114 million tonnes and global trade at 109 million tonnes.

For the last fiscal year, it estimated production at 618 million tonnes, consumption at 621 million tonnes, inventories at 135 million tonnes and global trade at 108 million tonnes.