The Australian Wheat Board has adjusted its wheat output forecast for the year ended 31 March down to 9.5-10 million tonnes.

The drought situation affecting much of the country's wheat-growing area is the largest factor in the downturn. In the last crop year Australia reported output of 24 million tonnes. The Wheat Board has revised down its estimated output a number of times since the drought began.

The US Department of Agriculture has issued forecasts broadly in line with the latest estimate from the Wheat Board.

On a brighter note, the Board said that the quality of its wheat had not been compromised, commenting in a statement: "The harsh season has failed to impact on wheat quality with above-average protein and low levels of shrivelled grains recorded."