* Australia set for record winter wheat crop
* Forecaster ABARES sees wheat crop at 29.5 mln/t
* To pressure prices in amply supplied market
* Most growers complete harvest before rains
(Recasts with quotes, details)
By James Regan
SYDNEY, Feb 14 Australia forecast a
record-high wheat output on Tuesday, boosting competition in an
amply supplied world market which analysts said is likely to add
more pressure on benchmark U.S. prices, down almost 5 percent
Australia lifted its estimate for wheat production this year
by 4.2 percent to a record 29.5 million tonnes, saying key
growing regions completed harvesting before the onset of heavy
Chicago Board of Trade wheat slid nearly 1 percent on
Tueday, falling for a fifth time in six sessions, as forecasts
of crop-friendly weather in the U.S. Plains and Australia's
estimate of a record large harvest weighed on the market.
"Australia will be competing in the world market through the
end of the year even when the other origins come in," said Adam
Davis, a senior commodity analyst at Merricks Capital in
Melbourne, referring to Australia's wheat production forecast.
"It is going to stretch Australian export infrastructure,
prices are already reacting to high global prices."
Australia's higher output forecast follows a U.S. Department
of Agriculture (USDA) estimate of a rise in global supplies.
A USDA report last week showed the world ending stocks at
213.10 million tonnes in the 2011/12 crop year, up from the
January outlook of 210.02 million tonnes and above analysts'
expectations for 208.963 million tonnes.
Exports of wheat from Australia, the world's fourth largest
supplier, were also revised up by 3.2 percent to 22.3 million
tonnes from the previous forecast, the Australian Bureau of
Agricultural and Resource Economics and Sciences (ABARES) said
in its latest crop report.
"Harvesting of this season's winter crop is now virtually
complete with only a small number of southern areas still to
complete harvest," ABARES said. The winter-planted crops are
normally harvested early in the new calendar year.
Some downgrading of cereal crops occurred in Queensland, New
South Wales and Western Australia states because of wet
conditions during the harvest.
In New South Wales, the second-largest wheat-growing state,
winter crop production is estimated to have fallen by 26 percent
versus the previous harvest to just over 7.9 million tonnes.
Rainfall in November and early December delayed the harvest
and resulted in some crop losses due to flooding in the north,
according to ABARES.
In Western Australia state, wheat production exceeded early
expectations and is estimated by ABARES to be up by 135 percent
in 2011-12 to a record of around 11.7 million tonnes.
"Yields were assisted by above average rainfall in October
and are estimated to be around 2.3 tonnes a hectare, the highest
average wheat yield on record for Western Australia," ABARES
However, the winter crop harvest in southern Queensland and
northern New South Wales was completed before recent flooding,
It estimates 75 percent of the wheat crop is milling grade.
Still, some analysts doubted ABARES's estimates.
"The (Australian) report today is perhaps a little higher
than expectations," Jonathan Barratt, an independent
agricultural analyst in Sydney, said.
"On the eastern seaboard, we had major concerns on the yield
and the quality of the wheat," Barratt said.
Turning to summer crops, ABARES said generally favourable
growing conditions are forecast to drive higher yields and
The upbeat forecasts come despite some eastern Australian
agricultural belts being inundated with flood rains for a second
year running, with at least two more months of the summer wet
season to go.
The Bureau of Meteorology's seasonal rainfall outlook for
February to April 2012 favours wetter-than-average conditions
across western Australia and generally average conditions for
much of southern and eastern Australia.
But La Nina, a weather phenomenon usually linked to heavy
rains and flooding, in Australia showed further signs of
weakening over the past two weeks as the tropical Pacific Ocean
warmed, according to the bureau.
The total summer crop area is estimated to be largely
unchanged in 2011-12 at 1.6 million hectares versus the previous
Cotton and grain sorghum production is forecast to increase
by 20 percent and 13 percent to around 1.1 million tonnes and
2.3 million tonnes, respectively versus last year's yields. Rice
production is forecast to increase by 27 percent to 923,000
tonnes, ABARES figures showed.
ABARES said some producers of summer crops in southern
Queensland and northern New South Wales had faced untimely heavy
rainfall and flooding.
"There is likely to be downgrading in crop quality and crop
losses for these producers, however until the flood water
recedes, the full extent of crop damage will be unclear," it
(Additional reporting by Pauline Askin, writing by Naveen
Thukral; Editing by Sugita Katyal)