Reuters — Australia raised its forecast for national wheat production this season by around 1.8 million tonnes to 35.6 million tonnes, cementing expectations for a bumper harvest that will add to abundant global supply and pressure prices.
Why it matters: Australia is a major export competitor with Canadian grain into Asian markets
In a quarterly crop report for December, the government’s ABARES agency also lifted its projections for Australia’s barley harvest by around 1.1 million tonnes to 15.7 million tonnes and canola production by around 800,000 tonnes to 7.2 million tonnes.
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Australia is one of the world’s biggest exporters of all three crops and is roughly halfway through its 2025/26 harvest. Wheat is used mainly for milling into flour, barley for animal feed and canola, or rapeseed, to crush for oil.
Plentiful supply helped push benchmark Chicago wheat futures in October to their lowest level since 2020. Barley and canola prices are holding up better, with barley in particular having more supportive supply-demand fundamentals.
“National winter crop production has been revised higher,” said ABARES, which stands for the Australian Bureau of Agricultural and Resource Economics and Sciences.
It said this was due to timely spring rainfall at critical growth stages and mild spring temperatures in most cropping regions.
Wheat production is now set to be four per cent above last year’s 34.1 million tonnes, 29 per cent above the 10-year average and the third-largest for any season on record, according to ABARES.
Barley output should come in 18 per cent above 2024/25’s 13.3 million tonnes, 33 per cent above the 10-year average and be the biggest ever.
The canola harvest is on track to be the second-largest on record, beating last year’s 6.4 million tonnes by 13 per cent and the 10-year average by a whopping 50 per cent, ABARES said.
The median estimates of five analysts just before ABARES published its numbers were for Australia to produce 36.1 million tonnes of wheat, 15.75 million tonnes of barley and 6.9 million tonnes of canola this season.
ABARES also issued forecasts for Australia’s summer crops, saying the country should produce 2.6 million tonnes of sorghum in the upcoming harvest, down four per cent from 2024/25, 943,000 tonnes of cotton lint, 23 per cent less than last season, and 178,000 tonnes of rice, down 66 per cent.
The sharp falls for cotton and rice are due to the lower availability of irrigation water, it said.
— Reporting by Peter Hobson
