The following is from the Dow Jones Newswires:
Low rainfall could halve the wheat crop in Australia’s largest wheat exporting state in the 2012-13 crop year, according to forecasts by one of Australia’s largest banks, hurting farmers at a time when world grain prices have shot up to near record peaks.
ANZ senior agricultural analyst Paul Deane said Western Australia’s wheat output could fall to 6 million metric tons in the crop year that started on April 1–almost half of the 11.6 million tons grown last year and down from his current forecast of 8 million tons–if plants don’t get rain over the next month.
Latest official government forecasts from June expect a Western Australia winter wheat crop of about 8.6 million tons.
“Yield potential is already well below trend in the northern and eastern wheatbelt due to the late start to the season and one of the driest Julys on record,” Mr. Deane said. “Production prospects for the Western Australian wheat crop are delicately poised,” he added.
Wheat prices have already risen about A$100 a ton over the past three months as drought in the U.S. and Russia–two of the world’s largest wheat producers–has sparked fears of tighter world supplies during the 2012-13 crop year. This season’s multi-milling wheat delivered from Geraldon, West Australia, is currently trading at A$340 a ton, according to AWB, Cargill Inc.’s Australian unit.
National Australia Bank analysts predict that Australian farmers could find themselves 6 billion Australian dollars (US$6.3 billion) richer this year if they are able to meet government June projections for rural exports of A$38 billion.
High stocks left over from a bumper wheat crop out of Western Australia last year could help farmers to compensate for any shortfall this year.
ANZ’s Mr. Deane said he expects exports in 2012-13 to remain roughly on par with 2011-12 at around 8.5 million tons–just below the record 9 million shipped in 2003-04–due to the unprecedented levels of carryover stocks left from the previous season.
“Even with this strong level of exports, Western Australia will still have record stocks to carry into the next season,” he said. “This provides a significant buffer to export availability even with an adverse production outcome,” he added.
Source: Dow Jones Newswires
Posted by Haylie Shipp
