September 16, 2014

Australia’s official commodities bureau, Abares, cut its estimate for the country’s wheat exports for July 2014 to June 2015 by 550,000 tons to 18.10 million tons – bringing wheat shipments from the country to a five-year low.  Although higher that the ten-year average, exports will still be 234,000 tons less than last year.  Factoring in the drop in prices of 8.6% year on year or A$16 per ton, the value of the country’s wheat exports will fall by A$500 million as well.  Abares lowered its forecast for Australia’s wheat harvest to 24.23 million tons from 24.59 million tons stating that yields in nearly all states will be down.  In addition, improved quality and production in China’s domestic wheat sector have lessened the need to imports.  The U.S. Department of Agriculture (USDA) lowered its forecast for Australian wheat for 2014/15 by 500,000 tons to 25.5 million tons keeping its estimate for exports at 19 million tons, while Rabobank is estimating Australian wheat production to be 24 million tons.  Abares has also lowered its forecast for Australian canola export volumes for 2014/15 by 28% or 267,000 tons to 2.3 million tons – a four-year low, while projecting a 41% drop in canola export value for the time period to A$1.1 billion.

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