Financial Times FT.com

Drought forces Australia to cut wheat forecast by third

By Peter Smith in Sydney and Javier Blas in London

Published: September 19 2007 03:00 | Last updated: September 19 2007 03:00

Australia's government yesterday slashed its forecast for this year's wheat production by almost a third as the country's drought-stricken farmers faced another year of ruined crops.

The revision from 22.5m tonnes in June to 15.5m tonnes pushed up wheat prices as the Australian crop was seen as critical to the balance of the market following damage to European and Canadian crops caused by bad weather.

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