AWB has released its first estimates of wheat pool returns for the 2010/11 season, with benchmark grade APW wheat forecast at $250 a tonne and ANW1 noodle wheat at $260 a tonne in the Western Pool and APW wheat at $244 a tonne in the Eastern Pool (FOB, excl GST).
AWB General Manager Commodities, Mitch Morison, said AWB released pool forecasts at this time of year to assist growers in planning their marketing programs.
“Crop sowing programs are underway in most parts of the country and growers are thinking about marketing this year’s crop, so estimates are timely at this stage,” Mr Morison said.
“We will update our estimates regularly right through the production and marketing cycles of the 2010/11 season crop, which is generally a period of 18 to 20 months by the time it is sold and delivered to customers, so we are looking a long way forward.”
AWB calculates its pool estimates with reference to international and domestic stock, production and price levels and its expectations around how the Australian dollar will perform, all of which impact grower returns.
“When we look at the market today, the world has had two years of record or near record wheat production and while the world crop is being forecast slightly lower this year, it’s not by much; USDA data put the previous two crops at 683 and 680 million tonnes, whereas the forecast for this season is 672 million tonnes, so we are looking at three consecutive years of strong production,” Mr Morison said.
“World stocks are very high and while consumption is forecast to increase on previous years, it is still expected that stocks will continue to increase, unless there is a significant production failure somewhere.
“The good news for Australian growers is the longer term outlook is for the Australian dollar to settle back a little, which will assist grower returns,” Mr Morison said.
AWB’s 2009/10 estimated pool returns (EPRs) for wheat are holding steady, with benchmark APW grade wheat in the western pool on an EPR of $242 a tonne, with the eastern pool EPR at $240 a tonne (FOB, excl GST).
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