The Australian Government Department of Agriculture and Water Resources (ABARES) has forecast that wheat production for the 2018/2019 marketing year will reach 16.95 million mt, the lowest since the 2007/2008 crop, according to a report released Tuesday.
Compared with last year's forecast, the 2018/2019 wheat production estimate has now been reduced by 20.2% due to drought and weather concerns in eastern Australia earlier this year.
ABARES has also forecast that wheat export is expected to dip 31.5% year-on-year to 10.62 million mt.
APW wheat prices have climbed to reach a one-month high of $278/mt FOB Kwinana on Tuesday despite the harvest season, in line with ABARES' forecast on reduced production and export numbers.
Market sources said that firm demand from Australia's east coast will continue to support domestic wheat prices, further reducing available supplies for export to Asia.
In the global wheat market, the forecast for total production for 2018/2019 inched 4.2% lower on the year to 731 million mt, due to declining production in major wheat exporting regions such as Black Sea and the European Union, ABARES said in its report.
