(Adds sugar, cotton estimates in last paragraph.)
March 5 (Bloomberg) -- Wheat shipments from Australia, the second-biggest supplier last year, will probably decline 5 percent in the year starting July 1 even as the crop increases because of higher plantings, a government forecaster said.
Sales will slide to 20.8 million metric tons from 21.9 million tons this year as less grain will be drawn from stockpiles, said the Canberra-based Australian Bureau of Agricultural and Resource Economics and Sciences. The harvest may rise to 24.9 million tons from 22.1 million tons, it said in a report, giving the first estimates for 2013-2014. Output was a record 29.9 million tons in 2011-2012.
Futures traded in Chicago have lost 26 percent after reaching a four-year high in July as recovering global harvests helped rebuild inventories. The U.S. Department of Agriculture may say on March 8 that stockpiles in the U.S., the biggest exporter, will be higher than its forecast last month, according to a Bloomberg survey.
“We had strong exports in 2012-2013 because it was off the back of a large crop,” Executive Director Paul Morris said in an interview in Canberra today. “Going into 2013-2014, we had a lower crop so exports are down a bit.”
Wheat declined 8.3 percent in February and reached an eight-month low of $6.975 a bushel yesterday on optimism snowstorms in parts of the U.S. may deliver moisture to drought- hit crops. Futures traded at $7.06 a bushel on the Chicago Board of Trade by 4:38 p.m. in Singapore. The so-called free-on-board Gulf price of U.S. hard-red winter wheat may decline 12 percent to average $320 per ton in 2013-2014, the bureau said.
Australian farmers may boost wheat plantings by 3.8 percent to 13.8 million hectares (34.1 million acres), the bureau said. Globally, farmers may sow 224 million hectares in 2013-2014 from 220 million hectares a year earlier, it said. Planting in the country starts from about April.
Farmers are switching to the grain after a heat wave curbed planting of summer crops, Morris said in the interview. “Some farmers missed putting in the summer crop this year as it was quite dry. Area that would have been planted with summer crops in parts of Queensland and northern New South Wales will be planted to winter crops this year,” he said.
U.S. wheat inventories before the 2013 harvest will be 702 million bushels, up from 691 million forecast last month by the U.S. Department of Agriculture, according to a Bloomberg survey of analysts. World reserves at 176.53 million tons may be little changed from last month’s estimate, the survey showed.
The bureau, also known as Abares, estimates global production will increase 4.9 percent to 688 million tons in 2013-2014, boosting stockpiles to 176 million tons from 174 million tons, according to the report.
Australia’s canola production may decrease 4.7 percent to 2.9 million tons in the year starting July, Abares said. Barley output may climb 11 percent to 7.8 million tons, it said.
Raw sugar output may total 4.5 million tons from 4.3 million tons a year earlier, the report said. Exports are set to increase to 3.2 million tons from 3 million tons, it said. Cotton production may reach 905,000 tons from 945,000 tons a year earlier, Abares said. Shipments may drop to 924,000 tons, from a record 1.1 million tons a year earlier, it said.
--Editors: Ovais Subhani, Jake Lloyd-Smith