* Australian wheat production seen up 15 pct on year ago
* Increased output to further pressure prices - analysts
* Canola production set to rise despite dry weather
(Recasts lead, adds analyst quotes, details)
By Colin Packham
SYDNEY, June 12 Australia, the world's
second-biggest wheat exporter, is expected to boost wheat
production by 15 percent this year to its fourth-largest crop on
record, with a bumper harvest set to put further downward
pressure on prices.
Wheat production for the new marketing year was expected at
25.4 million tonnes, up 2 percent from a March forecast and well
above last year's 22.1 million tonnes, the Australian Bureau of
Agriculture and Resource Economics and Sciences (ABARES) said on
Other wheat producing nations have forecast big crops,
particularly in the Black Sea region, and higher Australian
output could put more pressure on Chicago Board of Trade wheat
futures, which have already fallen more than 10 percent
this year on expectations for a bumper global crop.
"We are not surprised by ABARES robust estimate. Seasonal
conditions have improved remarkably since the second half of
May," said Luke Mathews, commodities strategist at the
Commonwealth Bank of Australia.
"The U.S. Department of Agriculture will issue its latest
supply and demand report tonight, and that is likely to point to
very large supplies in the year ahead," he added.
ABARES made no mention of the recent discovery of
genetically modified wheat (GMO) in the United States, which has
turned some buyers away from U.S. wheat, although market
concerns have eased in recent days.
Japan, which had halted all imports of U.S. feed wheat, said
on Tuesday it was looking to buy 120,000 tonnes of U.S. product,
alhtough it excluded wheat from Oregon where the GMO wheat was
Australia's commodities forecaster said acreage devoted to
wheat would rise 3 percent in 2013/14 from the previous year as
dry weather across much of Australia's east coast prevented
farmers from planting canola before the sowing window closed.
Australia's overall wheat output will be buoyed by strong
production from Western Australia, the country's largest grain
producing state, ABARES said.
Production in Western Australia was forecast to rise 29
percent to 8.8 million tonnes, as the state recovers from dry
conditions that checked yields in the previous season.
ABARES still raised its production forecast for 2013/14
canola to 3.230 million tonnes, up nearly 10 percent from its
March estimate, even though dry weather at planting time
prevented farmers from completing intended acreage.
It also raised its estimate for cotton, pegging cotton
production during the 2013/14 season at 995,000 tonnes, up from
estimated production of 905,000 tonnes in March.
(Editing by Richard Pullin)