August 12, 2008

Global wheat prices down, but no change in Australian crop returns

Morison was commenting on AWB not changing its estimate of returns from collective export sales of the benchmark grade Australian Premium White grade of 10.5 percent protein, to be harvested late in 2008, in a range from AUD350 per tonne to AUD370 per tonne, free on board.

US wheat futures have slumped in the past two weeks, but a decline in the value of the Australian currency in this period remains supportive of Australian commodity prices, so there has been no change to AWB's estimated pool return, he said.

International feed wheat values, especially in Europe, continue to weaken as about 80 percent of Ukraine's crop has been estimated as feed wheat quality, he said.

Russia's harvest continues to progress well, with Black Sea milling wheat prices remaining firm and continuing to set the international benchmark for price, he said.

The US winter wheat harvest is nearing completion, with the potential for the USDA to further increase its current production estimates, he added.

"Spring wheat crops in the US have experienced mixed conditions of late, with an average crop expected in the US, but conditions in Canada have improved, leading to an increased production potential for the Canadian spring wheat crop," Morison said.

US$1 = AUD1.1393 as of August 12, 2008