Wheat: Record crop from Australia hits the market

Prices for Australian wheat on offer in Asia fell below offers from the Black Sea region this week for the first time in at least four years. The country is expected to have a near-record harvest, according to two sources of trade.
For January shipping, Australian Premium White (APW) wheat is quoted at $ 275 per tonne, including cost and freight (C&F), to Southeast Asia, compared to a similar quality Black Sea wheat at $ 285 per tonne.
"The price is likely to keep falling as the harvest is looking really good," said Ole Houe, director of advisory services at the agricultural brokerage firm IKON Commodities in Sydney. "The growers are happy sellers at today's numbers and the yields are enormous."
IKON Commodities estimates the wheat harvest in Australia for 2020/21 at 32 million tons.
"The latest upward revision is based on reports of record-yielding wheat in northern New South Wales (NSW) as well as widespread rainfall in eastern Australia which should give the country an extra last minute boost for southern Australia," the broker said in a report.
"Production in NSW is now estimated at 13.2 million tons, which would be an all-time high."
This compared to the Australian Bureau of Agricultural and Resource Economics and Sciences, which forecasts the country's wheat production for the year ending June 30, 2021 at 28.91 million tons, compared to its June estimate of 26.67 million tons.
"For the first quarter, Asian wheat buyers will be buying in Australia," said a Singapore-based trader. "The prices are cheaper and the quality is good."
Australia has suffered drought for the past three years, dampening wheat production and raising prices.

Hansa Terminhandel GmbH
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