Recent rains in Australia may boost the next wheat crop, which is already half planted, to a record of around 25 million tonnes, rural brokers said on Friday.
February rains in Australia, the world's second-largest wheat exporter after the United States and one of the biggest players in wheat futures on the Chicago Board of Trade, had broken the country's worst drought in a century.
But since then the country has endured months of extremely dry weather. However rain over the past two weeks has set the stage for good crops in the two main producing states of Western Australia and New South Wales, while farmers in Victoria, South Australia and central Queensland still need rain.
Rob Imbrue of rural broker FarMarCo on Friday put the likely wheat crop size at 24 million to 25 million tonnes, with a potential for 27 million tonnes if NSW turned in a good crop.
Australia's shrinking sheep flock was freeing extra acreage to produce more crops, he said. Australia's sheep flock has declined to 96 million, the lowest in around 50 years and down from 166 million in 1991, because of a sharp rise in slaughtering triggered by the severe drought of 2002 and 2003.
Gradual re-building of the flock size is in progress but is being restrained by lacklustre wool prices.
Private group Australian Wheat Forecasters says the country will produce a record-smashing crop of 27.2 million tonnes, well ahead of the existing top crop of 25.2 million in the latest year to March 31.
Monopoly wheat exporter AWB Ltd is forecasting a crop range of 21 million to 24 million tonnes. Government unit, the Australian Bureau of Agricultural and Resource Economics (ABARE), is set to update its March forecast of 21.9 million tonnes on Tuesday.
"Western Australia is at full steam (with) planting," an AWB spokesman said on Friday. Growers who gambled by planting "dry" before the recent rains could be finished sowing soon, although areas in the south of Western Australia were yet to start planting.
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