The dismal start for US winter wheat seedlings has worsened the
country's export prospects by threatening a rise in domestic prices and handing
competitiveness to rival shippers, US farm officials said.
The US Department of Agriculture, expanding on a decision on
Tuesday to downgrade hopes for American wheat exports in 2012-13, said that
prospects for shipments "continue to decline".
"Even though it has been expected that US wheat exports will
be back-loaded, with more exports occurring in the later part of the [marketing]
year when the main competitors exhaust their supplies, the current US pace of
exports is extremely poor," the USDA said.
"Already, five months into the international marketing year,
it is getting increasingly difficult to achieve projected exports, especially
with larger wheat supplies and stronger competition from Australia and Canada."
From July to the end of November, exports appeared to be
tracking 10% lower than a year before, when comparing the sum of shipment data
and unfulfilled sales.
And the poor start to the 2013 US winter wheat crop, which
has entered dormancy in its worst condition on record, has exacerbated the threats
to export hopes.
"The outlook for next year's US wheat crop has grown
increasingly uncertain, given unfavourable November crop conditions," the USDA
If a "pessimistic outlook" for the crop was realised, "wheat
prices could rise more than would be expected seasonally", with an impact on
The USDA on Tuesday, in its benchmark Wasde crop report, cut
by 50m bushels (1.4m tonnes) to 1.05bn bushels (28.6m tonnes) its estimate for
US wheat exports, a revision blamed for a drop in wheat prices to a succession
of five-month lows.
At Texas A&M University, farm economist Mark Welch said
that while wheat exports were now on a "straight-line trajectory" to meet the
USDA's 2012-13 projections, meaning the weekly pace was on target, normally
shipments were quicker earlier in the season.
"Usually we have reached 70% of the marketing-year export
projection by the end of November compared to 58% this season," Dr Welch said.
Chicago wheat futures for March stood up 0.3% at $8.10 ¾ a
bushel at 10:40 UK time (04:40 Chicago time), on track for their first gain in