AWB wheat pool forecasts mixed, introduces new grade

by World Grain Staff
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MELBOURNE, AUSTRALIA — AWB has introduced a new wheat grade in its eastern pool to address seasonal effects on milling quality in New South Wales, while at the same time updating its forecast 2010-11 season pool returns, the company announced on Nov. 23. Specialty noodle and durum grades are forecast higher, while other grades are slightly lower.

AWB’s estimated pool return (EPR) for ANW1 noodle wheat is up A$1 to A$463 a tonne and all durum grades are up A$6 a tonne, while benchmark grade APW wheat in the western pool is down A$4 to A$328 a tonne and APW wheat in the eastern pool is down A$4 to A$312 a tonne (FOB, excl GST).

AWB’s general manager, commodities, Mitch Morison, said the market was supportive for noodle wheat and durum grades. However, other grades had drifted lower amid continued weakness in commodity markets as global fund managers reposition themselves amid economic news coming out of China.

“World events are affecting commodity markets generally, and while China still dominates headlines we are again witnessing large wheat price moves that are unrelated to wheat market fundamentals,” Morison said. “The good news is that consumers were quick to respond and have expressed buying interest at these prices, which underpins Australian wheat prices.

“The pressure for eastern Australia is in grain quality due to late spring rains that have continued into harvest. We are investigating what grades are required to handle the crop and achieve maximum value, with the major issue at this stage being low falling number.

“We are assessing export demand for higher protein wheat with a lower falling number, and if we can extract a premium we will ensure that the pool returns any premium to growers. For the domestic market our eastern pool will also be accepting AH9, which is high-protein grain that has no falling number limit.”
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