February 16, 2005

Australian wheat crop estimate increased by 1 percent

Australia, the second-biggest wheat exporter in the world, has raised its production estimate for the grain by 1 percent.

The last wheat harvest was 20.4 million metric tons, according to the Australian Bureau of Agricultural & Resource Economics. That compares with the Canberra-based bureau's November forecast of 20.2 million tons and the 25.7 million tons gathered a year earlier.

Australian farmers, who harvest wheat between October and January, may expand production in the coming year to buffer incomes from falling prices, some analysts have said. AWB Ltd., the country's monopoly wheat exporter, said last week farmers may get as much as 14 percent less for wheat sold overseas after crops in Europe and South America caused a global oversupply.

Wheat is Australia's most-valuable farm export after beef, worth A$4.2 billion ($3.3 billion) in 2004. Abare raised its production estimate for the crop because of more rain.