British wheat goes Down Under

AUSTRALIA, one of the world's largest wheat producers and exporters, is shaping up as a promising new market for the UK wheat industry. Two shipments of British wheat have so far been sent to Australia, which is in the grip of one of the worst droughts in memory, and Australian traders are predicting that more orders will flow this month.

'There is going to be a long-term importation of this stuff, said one trader today, pointing out that British wheat can be landed at up to A$50 (£18) a tonne cheaper than domestic feed wheat, which has been pushed up to A$305 a tonne by drought shortages.

One shipment of 50,000 tonnes of British feed wheat left the port of Tilbury in late November and a second shipment sailed in December. Local traders say Australia has so far purchased about 300,000 tonnes of UK wheat but quarantine authorities say only 150,000 tonnes have so far been approved, valued at around A$45m.

Australia's 2002 wheat crop has been more than halved by the drought, and this year's crop is forecast at 10m tonnes, down from 24m tonnes in 2001. Executives of the recently privatised Australian Wheat Board are reportedly taking pay cuts as a result of the crisis.

Britain's wheat industry, by contrast, is in a significant upswing, with the 2002 crop estimated at 15.8m tonnes against last year's weather-blighted 11.57m tonnes. Britain has also exported wheat recently to the US, Cuba, South Africa and Morocco.