October 7, 2008

Australia' ASX January wheat declines; rain helps some crops 

Wheat futures in Australia fell slightly, pulled down by the slump in US prices.

Wheat futures in Australia fell slightly Tuesday, 30 September 2008, pulled down by the slump in US prices Monday, 29 September 2008 though a sharply weaker Australian currency almost offset the US price impact.

At 0615 GMT, ASX January wheat last traded at AUS$278 a tonne, down AUS$1 from Monday's settlement and extending a decline from A$300 early last week.

US wheat futures and commodities in general tumbled Monday, 29 September 2008 on global economic woes, with CBOT December wheat falling 45 cents to settle at US$5.9525 a bushel to close below US$6.00 a bushel for the first time in more than 12 months, to less than half its mid-March high of US$12.5750 a bushel.

GrainCorp Ltd. (GNC.AU) said in a weekly market review last Tuesday the weak AUD/USD exchange rate has sheltered Australian wheat values from the sharp falls in the international (wheat) market.

At 0615 GMT, the Australian dollar last traded at US$0.7229, well down from Monday's high of US$0.7738 and from US$0.8519 Sept. 22.

GrainCorp reported widespread rainfall over the weekend greatly benefited crops in central and northern New South Wales, where expiring ASX wheat contracts are deliverable.

It said however, parched wheat crops in southern New South Wales, Victoria and South Australia could trigger a decline in the harvest area and the yields for these regions.

Forecasts for the Australian wheat crop to be harvested by the year-end stand in a range of 18 million-23 million tonnes, most of which is available for export.