August 2, 2012

Western Australia's 2012-13 grains crop likely down by a third

In the 2012-13 season, Western Australia's grain production is likely to fall to 9.5 million-10.5 million tonnes, down by about a third from a record 15 million tonnes last year.

Australia was the world's No. 2 wheat exporter in the last crop year and the government forecasts nationwide wheat production will fall 18% to total 24.1 million tonnes during the 2012-13 season.

Grains markets are on edge in case of any further supply disruptions after prices led by corn have soared due to an unrelenting drought across the US Midwest and also hot weather in the Black Sea region threatening crops. Australia's wheat season has got off to a slow start as plantings were delayed after unseasonably dry weather.

"Our forecasts (for Western Australia) have come down. We had some good rains overnight, which keep (our estimates) where they were, but right now we see grain production at between 9.5-10.5 million tonnes," Mick Daw, acting general manager, operations, CBH Group said on the side lines of a grains conference in Melbourne.

He said later about 70% of the grains harvest is wheat, which would be 6.65-7.35 million tonnes.

Forecasters were predicting only a little rain over the next two weeks, Daw said, but longer range predictions saw better rains for August and September, a vital period for the yield determination of Australian wheat. The CBH forecast is below the government's most recent estimate.

Western Australia is forecast to be the largest wheat producing state growing 8.7 million tonnes, while New South Wales is expected to grow 6.9 million tonnes, Australia's Department of Agriculture, Fisheries and Forestry has said.