Australia was expected to produce 19.1 million mt of wheat in the 2018-19 (October-September) season, down 10% from 21.2 million mt in 2017/18, the Australian Bureau of Agricultural and Resource Economics and Sciences said.
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The decline in estimate is primarily attributed to reduced crop prospects from exceptionally unfavourable seasonal conditions in Queensland, New South Wales and parts of Victoria and South Australia.
In New South Wales, the well below average rainfall during the planting window resulted in much less area planted to winter crops than was initially intended. As a result, wheat production is forecast to fall by 44% to 2.5 million mt in 2018-19.
In Queensland, the dry conditions and low levels of soil moisture reduced potential yields with wheat production forecasted to be around 525,000 mt, down 23% from the previous harvest.
In Victoria, below average winter rainfall and low soil moisture reduced wheat yield prospects by 33% to 1.7 tonnes per hectare with production forecasted at 2.7 million mt.
South Australian wheat production is forecasted to fall by 10% to 3.7 million mt due to 13% decline in average yield.
“Timely rainfall in early spring will be critical to ongoing crop development in many cropping regions in eastern states (including South Australia) because of low levels of soil moisture,” ABARES said in its report.
Most crops in Western Australia were in good to excellent condition at the start of spring with many crops expected to achieve good yields even without further significant rainfall.
“In Western Australia, favourable spring conditions could boost production beyond that being forecast,” the report added.
The rainfall outlook for September indicates cropping regions in New South Wales and Western Australia to have a 5% chance of recording close to median rainfall for the month, while that in Victoria, South Australia and Queensland have a 50% chance of recording half their medium rainfall.
In Western Australia, the largest wheat exporting region in the country, wheat production is forecasted to rise by 31% to 9.6 million mt in 2018-19 with an average yield of 2 tonnes per hectare.
In the 2018-19 marketing year, with close to half the country’s wheat production coming from Western Australia, the region is expected to cater for domestic demand, which is mostly in eastern Australia, as well as foreign exports to Asian markets.
“Its going to be an interesting year with WA likely to produce a record crop. Suppliers in WA has to balance between serving the domestic market, where prices may be attractive, versus competing with cheaper origins in the export market,” said an Australian trader.