World Grain - April 2007 - 16

newsreview
China's 2007 wheat production
forecast to decline 4.1%

E.U. says it will lower farm subsidies if AWB's single desk is eliminated
CANBERRA, AUSTRALIA - While in Australia in early March for talks with trade officials,
the European Commission's deputy director-general for trade, Peter Balas, said that the E.U. is
willing to lower its farm subsidies if Australia gets rid of the single desk for wheat exports.
"It (the single desk) has to be committed to be removed in the same way as the E.U. is committed to removing all its export subsidies," he said. "For decades we heard that the major
reason for operating this kind of export monopoly was the existence of export subsidies in
other countries. Once export subsidies are not there, there is no more justification for this kind
of corporation."
The E.U. has also challenged the U.S. to mirror its offer as a way to salvage global trade
talks.

BEIJING, CHINA - China's wheat production in 2007 is predicted to decline 4.1% from
last year to 99.5 million tonnes, a decrease of
4.3 million tonnes, or 4.4%, according to a
forecast made by the China National Grain
and Oils Information Centre.
The nationwide acreage sown to wheat this
year is estimated at 22.8 million hectares, a
slight drop from last year. The centre attributes the projected decline to the drought in
northern China, which has affected sowing
and the normal growth of winter wheat.
The decline in sowing area is the main
reason behind an expected decrease in the
country's winter wheat production this year,
the centre noted.

CBH Group delivers wheat to Indonesia
WEST PERTH, AUSTRALIA - Co-operative Bulk Handling, Ltd. (CBH) of Australia announced on March 15 that the second shipment of wheat under the CBH Group's historic
wheat export license has now arrived in Indonesia.
The shipment, containing 27,000 tonnes of wheat, left the CBH Group Esperance Terminal
on Feb. 19 and arrived in Makassar, Indonesia on Feb. 28.
Tony Critch, CBH Group chairman said wheat from the first shipment of 25,000 tonnes,
which arrived in Indonesia on Feb. 11, has now been milled into flour at the Eastern Pearl
flour mill.
"The grain from the first shipment has been well received and milling characteristics have
exceeded the mill's expectations compared to historical supplies," Critch said.
Further shipments under the CBH Group's export license for 500,000 tonnes of wheat are
currently being scheduled and will continue to take place over the next few months.

Correction
In an article titled, "The changing face of
grain transportation," in the February issue
of World Grain, Simon Clancy, senior commodities trader with Australia's GrainCorp
Ltd., was incorrectly identified. World Grain
apologizes for the error.

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World Grain - April 2007

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