With estimates of Black Sea wheat production falling due to drought, there is increasing interest in whether southern hemisphere wheat crops in Australia and Argentina can help fill the deficit.
Australia seems guaranteed to produce at least an average crop, but because it is early in the growing season in Argentina, the situation there is less clear.
There are two stories in the Australian crop.
It has been dry in Western Australia and although rain was forecast for this week, analysts believe production will be less than forecast in the state, which normally produces 40 percent of the country’s wheat crop.
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Rabobank forecasts the state will harvest 6.3 million to 6.7 million tonnes of wheat, down from an estimate of 7.5 million earlier this year and 8.2 million tonnes last year.
But Rabobank has maintained its countrywide forecast of 21.8 million tonnes because of good crops in the eastern part of the country due to
good rain. Last year, Australia produced 21.7 million tonnes and in 2008-09, it grew 21.4 million.
In Argentina, farmers are winding up seeding. Wheat acreage will be up from last year and hopes are for better yields after drought slashed production last year.
The Argentine government does not have a production forecast, but the U.S. agricultural attaché in the country last week forecast 13.5 million tonnes, up from 9.6 million last year. That is higher than the United States Department of Agriculture forecast in July of 12 million tonnes.
Argentina is also experiencing a sharp divergence in the weather with Buenos Aires province on the Atlantic coast getting too much rain and provinces inland suffering from dryness.
Drought could again become a problem for the country. The U.S. National Oceanic and Atmospheric Administration and Australia’s weather service last week said the predicted La Nina has now formed in the Pacific Ocean. It has the potential to make Argentina drier than normal and bring more rain to Australia.
