THE outlook for Australian wheat is gloomy, with solid corn plantings in the US expected to cause a further weakening in prices.
On Monday Australian wheat was trading at $212 a tonne for May deliveries on the east coast.
Emerald Group risk and pricing general manager David Johnson said Australian wheat prices had been underpinned by world feed prices in the past year with a lot of wheat being fed to livestock instead of corn.
"Corn supplies were so tight that wheat was being fed instead," Mr Johnson said.
"But the US is now looking at record plantings of corn crops, so we'll start to see wheat move out of feed rations in the last quarter of this year.
"We'll potentially see corn prices ease."
But soybean prices were likely to remain strong and underpin canola prices.
Mr Johnson said a small soybean crop in South America and the US importing soybeans from China was helping worldwide oilseed demand.
The high Australian dollar was "not helping" either oilseeds or cereal prices.
"We're hoping to see the currency lower this year," he said.
Emerald was forecasting a 24.5-million tonne Australian wheat crop this year, similar to Rabobank's forecast of 24.7 million tonnes.
There would be a slight increase in canola plantings with a decent autumn break.
