Mounting fears for durum production from the key North American producers have prompted AWB to hike by Aus$60 ($65) a tonne its forecast for farmers’ returns from the pasta wheat, even as prices of other grains fell back.
Australia’s former wheat export monopoly forecast that durum growers using its marketing pools could expect Aus$400 ($434) a tonne in 2011-12 – compared with a Aus$340-a-tonne estimate released two weeks ago.
The upgrade takes the estimate above the Aus$375-a tonne figure for 2010-11, making durum growers are the only wheat farmers on course for higher payments in the new season.
And it reflects a market "being influenced by smaller planted acreage in Canada and the US", AWB spokesman Jon White said.
"We believe durum prices should remain volatile until North American production is more certain and Canadian pricing becomes clearer."
Canada earlier this month estimated its durum sowings had rebounded nearly 40% from last year’s rain-dented levels, although a second year of poor plantings conditions meant that, even at 1.8m hectares, they were well below the 2.3m hectares achieved two years ago.
In the US, officials have forecast a 34% slump to 1.7m acres in sowings, with plantings in North Dakota alone plunging 800,000 acres "due to an excessively wet winter and spring followed by severe flooding".
Meanwhile, global demand has remained firm, and is expected to remain above production in 2011-12, with Canada’s farm office putting the shortfall at 1.1m tonnes, a factor which has supported prices.
Algeria’s state grain agency two weeks ago, having tendered for 50,000 tonnes of durum, bought only 25,000 tonnes, a cutback thought to have been price drive.
The country is believed to have paid $510 a tonne, including freight, with talk that French durum was offered at $550 a tonne.
French durum was on Monday priced at E340 a tonne at Port La Nouvelle, down E10 over the past week but steady on the month, according to consultancy Agritel.
AWB’s comments came on a weak day for grains on US futures markets, weakened by the lack of progress on crucial US budget talks as well as by forecasts of rain for American corn, which last week suffered scorching temperatures deemed by many analysts as sufficient to reduce yield potential.
Chicago wheat for September closed the overnight Globex electronic session down 1.0% at $6.85 ½ a bushel, with corn for the same month losing 1.1% to $6.82 ¼ a bushel.
However, the prospect of US corn losses had been "providing a level of support to all feed grades" of wheat, AWB said, lifting its forecast for farmers’ returns from feed wheat by Aus$5 a tonne to up to Aus$235 a tonne.