March 6, 2007

 

Australia's Abare estimates 2007/08 wheat crop at 25 million tonnes

 

 

Production from the 2007/08 Australian wheat crop will rise to 25 million tonnes, rebounding from drought-affected actual output of 9.8 million tonnes this crop year ending March 31 on the back of expected improved seasonal conditions, according to an official forecast issued Tuesday.

 

Barley production next crop year is estimated at 8.9 million tonnes, up from actual output this crop year of 3.7 million tonnes.

 

Canola output from crops to be planted in May and June and harvested mostly in November and December is forecast to recover to 1.3 million tonnes from 513,000 tonnes this crop year.

 

The forecasts are contained in the latest quarterly commodities outlook publication issued by the government's chief commodities forecaster, the Australian Bureau of Agricultural & Resource Economics, or Abare.

 

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

 

Assuming average seasonal conditions, Abare expects total winter production next crop year to rise to 38.4 million tonnes, more than doubling from 15.7 million tonnes previously.

 

Abare noted the government's Bureau of Meteorology has said an El Nino weather event, which was associated with a drought in Australia in 2006, has ended.

 

Using this and other assessments, it is reasonable to expect a sharp increase in the area sown next crop year, though this will depend on the timing and extent of autumn and winter rains, Abare said.

 

The expected increase in production from this expanded sowing will boost availability of export wheat, after domestic needs of about 6 million tonnes a year are met.

 

Abare forecast wheat exports will rise next fiscal year to 15.8 million tonnes valued at A$3.69 billion from an estimated 12.7 million tonnes valued at A$3.12 billion this fiscal year ending Jun 30.

 

Large volumes of carryover stocks from last fiscal year are being drawn on to meet current export demand, it said.

 

Abare forecast the price of the indicator US hard red winter wheat, FOB US Gulf of Mexico, to average US$193/tonne next fiscal year, down from US$210/tonne this fiscal year, with a forecast increase in production to outweigh the impact of an expected rise in consumption.

 

For next fiscal year, Abare projects world production at 625 million tonnes, consumption at 621 million tonnes, closing inventories at 121 million tonnes and global trade at 112 million tonnes.

 

For this fiscal year, it estimated production at 589 million tonnes, consumption at 607 million tonnes, inventories at 116 million tonnes and global trade at 106 million tonnes.