WASDE: Australian winter crop production holds strong
While Australia’s production volume estimates remain unchanged for 2020-21, an international report predicts lower production in the United States this month - lifting global grain prices.
AUSTRALIA’s outlook for wheat production remains positive as this month’s World Agricultural Supply and Demand Estimates predictions remain unchanged from last month.
The United States Department of Agriculture’s report — released over the weekend — kept Australian production volumes for 2020-21 sitting at 26 million tonnes.
According to Rabobank’s Agribusiness July report, Australia’s outlook for supply recovery continued to support southern hemisphere supply despite “dryness concerns for Argentina.”
“The chance of La Nina performing is now 50 per cent and double the average likelihood – according to the Bureau of Meteorology,” the report said.
“If the weather system eventuates it will bring increased rainfall in central, eastern and northern parts of Australia.”
For the United States, the USDA forecast wheat production to reduce about 1.4 million tonnes in 2010-21 to about 49.6 million tonnes.
Winter wheat production is lowered about 1.3 million tonnes to about 33.1 million tonnes with reductions in Hard Red Winter and Soft Red Winter.
Other spring wheat dropped from last year at 14.9 million tonnes on lower forecast yields while Durum is higher at 1.5 million tonnes on increased harvested area.
As of Friday, a Commonwealth Bank market report found Chicago prices lifted “sharply.”
“The USDA published some lower US Soft Red Winter wheat crop estimates to help that market,” Commonwealth Bank market report author Tobin Gorey said.
Mr Gorey said ASX East January ’21 futures shifted by a dollar, finishing last week at $295 a tonne compared to $296 on Thursday.
“Spot prices at southern and eastern ports were marked higher for a second day,” Mr Gorey said.
Rabobank said it now expects Chicago Board of Trade wheat to trade at about US485 cents a bushel to US495 cents a bushel over the coming year.
Overall, this month’s WASDE found the global wheat outlook was for smaller supplies, reduced consumption, lower exports and decreased stocks.
Production in Europe is lowered 1.5 million tons to 139.5 million, due to reductions for France and Spain.
This is compared to June predictions of 141 million tonnes.
And if estimates are correct, the WASDE indicated this would be the smallest European wheat production since 2012-13.
Meanwhile global trade for 2020-21 is reduced 800,000 tonnes to 188 million as lower European exports are partially offset by higher Australian exports.
MORE
Mice inflict grain pain
A mice outbreak is causing havoc across summer cropping areas. Here’s what’s being affected.
Saudi Arabia a barley saviour
After losing China as a market, a large volume of Australian barley has found a home.