Hot and dry conditions on the east coast have pushed Australia's 2019-20 winter crop prospects lower again, according to the latest forecasts from Rabobank.
Grain and oilseeds senior analyst with Cheryl Kalisch Gordon said combined with CBOT wheat gaining six per cent MOM, it has supported most Australian wheat prices higher across Australia during the month.
“Our expectation that the market still has more Australian supply downside to recognise, plus the prevailing hand-to-mouth purchasing environment, means we expect upside for basis during October,” Ms Kalisch Gordon said.
“Catastrophic frost in Western Australia during the first half of September, focused on the Esperance port zone, has added another blow to the struggling 2019-20 Australian winter crop.
“Elsewhere, ongoing dry conditions and unseasonably high temperatures have stopped crop development in its tracks.”
While APW gained five per cent (or close to it) in all other port zones during September, Brisbane was the exception.
APW lost five per cent over the month with good new crop supply from central Queensland playing into calculations.
Ms Kalisch Gordon said globally, wheat prices firmed MOM on the back of reduced supply prospects.
The USDA lowered global 2019-20 wheat production by nearly 2.5 million tonnes in its latest report.