Australia's wheat output seen down

Australia's wheat output is likely to slide more than 15 percent in 2012/13 from a record-large crop this year as lower global prices may prompt farmers to shift to other crops such as canola and barley.
Wheat output is expected to fall to 25 million tonnes in the year to June 2013, down from an all-time high of 29.5 million tonnes which is estimated to have been produced this year, according to a Reuters survey of 10 analysts.
Australia is typically the world's fourth largest wheat exporter, and sales are unlikely to diminish in 2012/13 as 25 million tonnes still constitutes a better-than-average crop, analysts said.
But the amount of wheat farmers will want to plant is likely to fall, with global supply forecast to exceed record highs next year and weigh down prices.
The benchmark US wheat futures has lost 1.2 percent so far in March, giving up more ground after finish lower last month due to plentiful supplies.
"We expect a pullback in Australia wheat plantings this year as canola plantings are likely to be the big winner this season because of the margins," said Paul Deane, a senior economist with ANZ.
Adam Davis, a senior commodity analyst at Merricks Capital and who participated the survey, added: "Barley prices are slightly less than wheat but yield is much higher and therefore a better cereal crop from a gross margin perspective in the southern states where they don't grow much high protein wheat."
The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) will announce its forecast on wheat and other crops next week.
Analysts said plentiful rains in the main crop growing regions boded well for wheat, barley and canola - crops that are planted in the season starting in April.
World wheat stocks at the end of the 2011/12 season look set to eclipse the previous record set more than a decade ago, according to the International Grains Council (IGC), raising its forecast for production to an all-time high.
The IGC, in a monthly update, increased its forecast for world wheat production by five million tonnes to a record 695 million, partly reflecting higher estimates for Kazakhstan, India and Australia.
Global crop prices will retreat sharply this year as farmers around the world expand production to bring stability back to commodity markets and ease fears of food inflation, the US government has forecast. After two years of razor thin stocks, world crop supplies, led by wheat, are recovering.