THE US Department of Agriculture is predicting huge ending stocks of 268.42 million tonnes in its latest World Agriculture Supply and Demand Estimates report.
The December estimates lift the ending stocks from the 267.53 million tonnes forecast in its November report.
The Australian wheat production forecast remained unchanged at 21.5 million tonnes, which Rabobank senior grain and oilseed analyst Cheryl Kalisch Gordon said was higher than industry estimates.
Rabobank has the wheat crop pegged at 20.9 million tonnes, while the Australian Bureau of Agriculture and Resource Economics and Sciences is tipping 20.3 million tonnes.
Ms Kalisch Gordon said the estimates of the Canadian wheat crop were lifted by three million tonnes due to a “softer finish to the season”.
She said the Black Sea countries were continuing their export programs free from expected disruption “such as frozen assets or frozen waterways”.
“With all of these events happening, we’ve seen the CBOT (Chicago Board of Trade) go below 400c/bushel,” Ms Kalisch Gordon said.
“That will be a challenge for the export zones, everywhere except the east coast, that rely very much on being competitive on the international market.”
Ms Kalisch Gordon said Rabobank was forecasting a 12 to 15 per cent appreciation in prices because of factors which included drier forecast out of the Great Plains region in the US, shifting planting intentions in Canada and a rise in demand.