Australia wheat stocks to decrease by 40% by end of 2018/19

Based on the report by UkrAgroConsult, the United States Department of Agriculture (USDA) forecasts an increase in Australian wheat exports in 2018/19 compared to the current season despite the unfavorable weather conditions for the crops.

Australia finished the sowing campaign in July. However, in the key regions of production, the amount of precipitation was 20-40% lower than the norm. It mainly rained in the southern regions of the country.

"In the current season, Australia will yield 22 million tons of crop, which is higher than the forecast for the previous season – 21.3 million tons. In the near future, meteorologists do not expect abundant precipitation, so the forecast is likely to remain unchanged,” informs the report.

At the same time, exports will increase to 16 million tons, or +1 million ton compared to 2017/18. The growth of exports will be stipulated by the reduced supply of high-quality wheat in the world market.

“The main buyers of wheat will still be Indonesia, the Philippines, China and South Korea. The share of Vietnam, which  amounted to 9% in the export of Australian wheat by the end of 2017/18, will continue to decline in favor of the Black Sea grain,” the report indicates.

Owing to increased exports, the ultimate wheat stocks in Australia will reduce by 40% to 3 million tons by the end of 2018/19.

Reference: experts believe the world wheat production to reduce up to 729.6 million tons in 2018/19, which is 6.6 million tons (or 4%) less than was previously assessed. It is also lesser than the harvest of 28.4 million tons of wheat in 2017/18.