Analysis-Abundant lower-quality Asian wheat supplies to fill corn shortage

 SINGAPORE: Record volumes of lower quality wheat from India and Australia are set to fill a gap left in Asia's animal feed market by a shortage of corn exports from South America, where drought is expected to reduce output, traders and analysts told Reuters.

Combined wheat production from India and Australia, the second-and fifth-largest wheat growers, respectively, will top 143 million tonnes in the 2021-22 season, more than 20 million tonnes above the yearly average from the two from 2015 to 2020, according to U.S. Department of Agriculture (USDA) estimates.

As a result, their exports are expected to surge to a record 32.5 million tonnes this season, more than twice the average annual volume for the same period.

While much of these exports will be of food-grade quality, a majority of Indian shipments and as much as a third of Australian exports will be suitable for use as animal feed across Asia, the world's largest market for livestock grains.

"There is strong demand for Australian wheat. We have shipping slots all taken right up to May," said Ole Houe, director of advisory services at agriculture brokerage IKON Commodities in Sydney.

"A lot of it is going into the feed market."

South Korea has snapped up roughly 400,000 tonnes of new-crop Indian wheat last week, while the Philippines and other importers in Southeast Asia have been taking Australian wheat.