Argentina's wheat exports will near-double in 2010-11 as sowings, which were hampered by drought last year, rebound further than local officials are betting on, US Department of Agriculture staff said.

The USDA's Buenos Aires bureau lifted by 1.0m tonnes to 8.0m tonnes its forecast for shipments from the South American country, whose wheat crop prospects are being closely monitored, given the problems in many other major producers.

The revision reflected raised estimates for sowings, as farmers exploit "better soil moisture conditions and continued high prices", the bureau said, pegging plantings at 4.5m hectares, some 250,000 hectares more than Argentina's farm ministry expects.

Furthermore, growers are reducing the intensity of soybean seedings, to combat a build-up of pests of the oilseed, and "are expected to put more wheat land into the crop rotation".

La Nina threat

The revision comes amid a surge in global wheat prices, reflecting the worst drought on record in Russia, but which many investors believe will depend for its future direction to a large extend on the fortunes of crops in Argentina and Australia, the southern hemisphere two biggest exporters of the grain.

Dry weather is also afflicting Western Australia, Australia's top wheat growing state, with a source at a leading Australian grain company telling Agrimoney.com on Friday that the state "could use some rain, that's for sure".

Rabobank analysts said on Friday: "It is worth noting that dry conditions continue to threaten Western Australia yields and La Nina weather patterns correlate strongly with below-average yields in Argentina, the combination of which may provide further bullish impetus for prices in the second half of 2010."

The bank has pegged Argentina's wheat crop at 12m tonnes.