The world's wheat supply is the lowest it's been in more than 30 years. After a poor year for wheat crops, how traditional wheat growing regions rebound this year will play a major role in replenishing world wheat stocks.
Of particular interest are conditions in Australia, which suffered a severe drought in 2007 that sharply cut their production. However, according to USDA World Agricultural Outlook Board Chair Gerry Bange, Australia's wheat crop should rebound in 2008.
"Conditions in Australia have improved considerably," Bange says. "There is a La Nina in process and that is usually associated with more rains in Australia and that appears to be happening."
Bange says most of the rain is falling in the eastern part of the country, while the south remains very dry and the western part of the country is experiencing its normal dry season.
"The Australian forecasters seem to think that what is going to happen is that these rainy conditions that we've seen in the East may in fact spread to the West," Bange says. "The wheat planting season of course doesn't really start until late April or early May. But we'll be looking very closely how these weather conditions evolve over the next few months and certainly during the crop season."