Market Summary

Sharply rising wheat prices prompted increases in winter wheat sowings in Europe and the U.S., but dry weather in the south of that country prevented planting targets from being met. There are large area increases in Russia and Ukraine. No significant change is expected in China, and India’s areas may fall short of last year’s. Competition from other crops may prevent spring wheat sowings from increasing much in the U.S., but a significant rise is likely in Canada.

There is no change in the 2007 production estimate of 603m. tons. Total 2007/08 consumption is also unchanged at 611 m. tons, higher estimates of wheat feeding in the CIS and Australia balancing reductions in North America and South Korea.

Forecast end-season stocks in the main exporters total 25 m. tons, 1 m. less than previously and a 30-year low. U.S. carryovers could be the smallest since the 1940s at under 8 m. tons.

Wheat markets recently drew strength from a smaller than anticipated rise in U.S. winter wheat plantings and strong demand for remaining North American premium milling grades. However, technical trading and major fund activity resulted in large price swings in futures, often hitting daily limits. Some exporting countries took further steps to safeguard domestic supplies, while several importers reduced or removed import duties on wheat or wheat flour. Despite high prices, international demand for milling wheat remained robust.

World grain and oilseed prices remain extremely volatile against a background of supply uncertainties and recent developments in financial, energy and other commodity markets. Prices of wheat and soybeans, especially U.S. futures, set new records in the past two months, while the outlook for maize (corn) tightened further. The focus in the weeks ahead will be on how northern hemisphere growers respond to price changes when planting their spring crops for 2008, as well as on the outcome of southern hemisphere maize and sorghum crops (Source: International Grains Council).

W H E A T	WORLD ESTIMATES	03/04	04/05	05/06	06/07 est.	07/08 forecast
						22.11	24.01
	Production	556	628	620	592	603	603
	Trade	102	110	110	110	104	104
	Consumption	594	616	624	609	611	611
	Stocks	128	140	137	119	110	110
	year/year change	-38	+12	-3	-18		-9
	5 major exporters **	43	59	58	38	26	25

**Argentina, Australia, Canada, EU, United States