The fall in wheat prices may be nearing an end, official Australian statisticians have signalled in a report which forecasts steadier corn and soybean markets.

The Australian Bureau of Agricultural and Resource Economics, in a report adding 15m tonnes to its estimate for global wheat production in 2009-10, cut $29 a tonne from its forecast for average global prices of the grain.

However, at $230 a tonne, equivalent to $6.25 a bushel, that leaves them above current levels, if below the $270 a tonne ($7.35 a bushel) average in the year to June 2009.

"World wheat prices will remain relatively high," Abare said, while failing to detail the reasoning behind the forecast.

The raise in estimate for 2009-10 global wheat production, to 662m tonnes, leaves Abare in line with US Department of Agriculture forecasts.

Barley hike 

Among coarse grains, Abare forecast benchmark corn prices – US crop free on board at Gulf of Mexico ports - averaging $156 a tonne ($3.96 a bushel), down $17 a tonne year on year, supported by growing use for feed and bioethanol purposes.

Hopes for Australian barley prices were raised by Aus$19 to Aus$232 a tonne for feed use and Aus$34 to Aus$266 a tonne.

Global barley output would, at 143m tonnes, fall marginally below previous forecasts and 11m tonnes year on year, reflecting lower production in Europe, Russia and, in particular, Canada, where a "delayed planting followed by dry seasonal conditions" had hurt crop development.

Production vs demand 

However, oilseed prices would "decline further as a result of expected record global oilseed production and higher stocks", Abare said.

"Higher production will outweigh the effect of any increase in world consumption," the bureau added, pegging the world indicator price – Rotterdam soybeans – at an average of $393 a tonne in 2009-10, down from $425 a tonne in 2008-09.

A rise in oilseed output would be led by soybeans, of which plantings are expected to increase 2% in Brazil and 13% in Argentina.