January 16, 2008

 

Asia Grain Outlook on Wednesday: Wheat may gain on strong global demand

 

 

Wheat prices in Asia are likely to keep rising the rest of this week, as global demand for wheat remains strong.

 

At the Chicago Board of Trade, wheat futures settled higher Tuesday, with competition in the U.S. getting fierce for securing acreage this year for planting wheat, corn and soybeans.

 

Demand for corn also remains robust around the world, while global stocks are quite tight.

 

In Asia, state-run Trading Corp. of Pakistan has postponed the final date for submitting bids for two wheat import tenders totaling 610,000 metric tonnes to Jan. 21 from Jan. 17 previously.

 

Traders in Pakistan are speculating that the tender deadline was postponed since the government hasn't received a good enough response from sellers.

 

Pakistan is seeking to import around 2 million tonnes of wheat by April to avoid local shortages, of which more than 200,000 tonnes has already arrived.

 

The government expects about 1 million tonnes of wheat to be delivered by the end of February and the rest by the end of March.

 

Meanwhile, in India, flour millers and government officials are buoyant about the prospects for the wheat crop, harvesting for which will begin later next month.

 

Flour millers said the new wheat crop is likely to be around last year's 74.8 million tonnes, which would be considered a bumper harvest. Optimism about the wheat crop persists despite a sharp drop in wheat acreage and continued concerns about dry weather in January and February, which may affect the crop's development.

 

Flour millers and government officials insist that the rise in wheat acreage in high-yielding provinces such as Punjab and Haryana will more than compensate for acreage losses in less productive provinces such as Madhya Pradesh and Rajasthan.