Outlook for Australian Wheat

The wheat outlook for Australia is dismal.

Dried up, washed out, fed up

Oct 4th 2007 GULARGAMBONE
From The Economist print edition

An inaccurate weather forecast brings disaster for many

WHEN rains fell in May after 11 dry years in a row, Bruce Crafter borrowed from his bank to sow a wheat crop on the family farm where he grew up in western Victoria. Like thousands of Australian farmers who have watched their livelihoods wither away under the country's worst drought in a century, Mr Crafter was encouraged by forecasts of follow-up spring rains in September. He sold one-third of his expected bumper crop on the futures market. But the rains never arrived, and the crops that promised salvation have failed. With no intended irony, Mr Crafter says: “We've been washed out.”

“Wash-out” is the term farmers are using to describe the contracts they can no longer fulfil. Australia is one of the world's biggest wheat exporters. The crop underpins the country's outback farming belt. After recent glitches to wheat supplies in North America...(complete article here).

The pressure on global wheat stocks remains high and prices will remain high as well.