Australia slightly raised its official forecast for the 2006/07 wheat crop on Tuesday to 9.7 million tonnes, but the estimate is still down 61 percent on a year ago as one of the worst droughts on record ravages crops.
The latest forecast is the lowest in 12 years after bumper production of 25.09 million tonnes in 2005/06, while output from the smaller summer crop was expected to fall 33 percent.
"It was the driest August to October period since 1900 across many cropping regions of Australia," Australian Bureau of Agricultural and Resource Economics executive director Phillip Glyde said in a statement. Drought has been worsening relentlessly throughout 2006, slashing the government's wheat crop forecast from an initial 24.5 million tonnes in March.
The wheat crop forecast is in line with a 9.6 million tonne estimate by private forecaster Australian Crop Forecasters and an October forecast of 9-11 million tonnes by monopoly wheat exporter AWB Ltd. Analysts said the main forecasts for Australia's winter crops were unlikely to change much now. "It's about what I expected.
The picture is painted," said Wayne Carlson, general manager, agribusiness, for National Australia Bank. The government bureau said in October that the drought was estimated to reduce economic growth in Australia in 2006/07 by around 0.7 percentage points.
The bureau on Tuesday also slightly increased its forecast for the coming barley crop to 3.67 million tonnes from its forecast of 3.59 million tonnes in October.
This is 63 percent below last season's production of 9.87 million tonnes. But the bureau further cut its forecast for the next canola crop to 426,000 tonnes from its October forecast of 440,000 tonnes.
This is 70 percent down on last year's production of 1.44 million tonnes. Forecast total winter crop production is down 62 percent to 15.5 million tonnes, while summer crop production is forecast to fall 33 percent to 3.1 million tonnes.
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