(Adds comments from Morris in fourth, seventh paragraphs.)
June 15 (Bloomberg) -- Wheat production in Australia, the fourth-largest shipper, may total 26.2 million metric tons in 2011-2012, 7.8 percent more than previously forecast and in line with last year’s harvest as favorable weather aids the crop.
The revised forecast compares with a March 1 projection of 24.3 million tons for 2011-2012 and estimated record output of 26.3 million tons in 2010-2011, the Australian Bureau of Agricultural and Resource Economics and Sciences said in a report today. The crop year runs to March 31.
The Australian harvest may help ease a worldwide shortage caused by droughts in the U.S. and Europe that have driven wheat prices higher and helped push global food costs to a record in February. Global demand will beat production for a second year in 2011-2012, the U.S. Department of Agriculture said June 9.
“Good soil moisture in the eastern states and favorable grain and oilseed prices have encouraged Australian producers to increase winter-crop plantings this year,” Paul Morris, deputy executive director at the bureau, said in an e-mailed statement.
Wheat on the Chicago Board of Trade has rallied 63 percent over the past year as corn surged 83 percent and soybeans climbed 49 percent. The September-delivery wheat contract traded little changed at $7.615 a bushel at 10:35 a.m. in Singapore.
The area sown to wheat may rise to 14.3 million hectares (35 million acres) from the 13.8 million forecast in March, the bureau said. Plantings in Western Australia may reach a record this year as farmers switch from canola and barley, Australia & New Zealand Banking Group Ltd. said on June 8.
‘Rainfall Is Needed’
“Recent rainfall over Western Australia’s cropping regions has also boosted winter-crop prospects in that state after a dry start,” Morris said. “Further rainfall is needed over the next few weeks to increase plantings.”
CBH Group, Western Australia’s largest grain handler, said on May 31 that rains have boosted optimism that the state will produce an average grain harvest of about 10 million tons after the previous season fell 35 percent short.
Australia’s total winter-crop production, including wheat, barley and canola, may be 40.8 million tons in the 2011-2012 season, the bureau said. The 2010-2011 total was estimated at 42.1 million tons, the report said.
Global wheat stockpiles at the end of the 2011-2012 season may be 184.3 million tons, according to a June 9 projection from the USDA. That would be lowest level since 2008-2009.
Cotton production in Australia, the world’s fourth-largest exporter, may have reached a record 898,000 tons in 2010-2011, also buoyed by rainfall, the bureau said. Output may gain to 1.1 million tons in 2011-2012, the agency forecast March 1.
La Nina-linked wet weather brought record rainfall to parts of eastern Australia last year, ending drought and replenishing dams used for irrigating cotton crops, which are planted in about November and mostly harvested from April.
Canola production is forecast at 2.3 million tons in 2011- 2012, up from the 2.23 million predicted in March. Australian output may jump to a decade-high 2.4 million tons this season, the Australian Oilseeds Federation said on May 17.
--Editors: Jake Lloyd-Smith, Jarrett Banks
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