A rebound in US wheat exports in latest weekly data
represented more than a flash in the pan, and heralds a recovery which will see
sales break records, Macquarie said.
The bank acknowledged that wheat export sales by the US, the
top shipper, had been "terrible" so far in 2012-13, falling well behind historical
levels thanks to the better prices offered for supplies from the likes of
Australia and the Black Sea.
"The US has remained uncompetitive internationally for the
majority of the season," Macquarie analyst Chris Gadd said.
However, export sales will see meet US Department of Agriculture
expectations of 29.9m tonnes (1.1bn bushels) for the full season even though that
means a sharp recovery in average volumes to 14.1m tonnes from now on – a record,
beating the current high of 13.3m tonnes set two seasons ago.
"Even though from a historical stand point reaching the
USDA's export target seems unlikely, we expect it will happen," Mr Gadd said.
Indeed, factoring in rain setbacks to the quality of
Argentine and Brazilian supplies, US exports "could possibly exceed" the
The forecast, which follows data showing the US enjoyed its
best wheat shipments in five months in the second week of November, reflected
the extent of the run down in supplies in alternative exporters, particularly the
Black Sea countries which dominated international tenders in the early months
of the season.
"The other major wheat exporters will have largely depleted
their supplies to the international markets by the first quarter of 2013," Mr
"Russian and Ukrainian exports are likely to fall to nearly
zero as we move into the new year."
The comments came as Ukraine's agriculture ministry performed
another u-turn over wheat trade curbs, saying it was "possible to continue exports"
even though an informal ceiling of 5.5m tonnes had been reached.
US wheat had "become about the most competitive
internationally", with soft red winter wheat, the type traded in Chicago, "to
see a strong export sales pace" from now on, Mr Gadd said.
"The likelihood would be that the US wins the next tender by
Gasc," the grain authority in Egypt, the world's largest wheat importer.
For US hard red winter wheat too, the higher-protein variety
traded in Kansas, export sales will "build in the coming months", given new
found competitiveness against rival supplies from the likes of Germany.
However, brighter prospects for US trade did not imply that wheat
prices were poised to soar, with enough competition remaining to keep values in
"Dominance in the [soft wheat] market isn't guaranteed as a
good supply of Australian standard white wheat should keep prices in check for
the remainder of the season."
In harder wheat, "supplies from Australia and Germany should
keep US export sales in check if the price were to rally substantially".
The comments came hours after Australia & New Zealand Bank flagged the competitiveness of Australian supplies.
Furthermore, demand from the major importers of the Middle
East and North Africa appeared to have waned, given the 15% drop in purchases
during the June-to-September period.
"We expect these trends to continue in this region throughout
the rest of the season," Mr Gadd said.
"Total demand is unlikely to reach the USDA's current import
projections of 21.8m tonnes and 22.1m tonnes for the Middle East and North