Dramatic cut to Australian winter crop forecast, as production expected to drop 23%

ABARES, the country’s agriculture bureau, revised down its prediction from September 2018 to reflect ‘unfavorable’ conditions in most cropping areas.

Australian winter crop production is set to be worse than predicted, falling by 23 percent in 2018-19 according to the Australian Bureau of Agricultural and Resource Economics and Sciences.

ABARES’s Australian Crop Report for December 2018 predicted the 2018-19 winter crop would fall by 23 percent to 29.3 million tons. ABARES estimates the 2017-18 crop produced 37.96 million tons across Australia.

This represents a significantly worse outcome than ABARES predicted in its last forecast in September 2018, when it forecast the crop would fall by just 12 percent to 33.2 million tons.

Prospects had deteriorated so much in early spring because of “unfavorable seasonal conditions in most cropping regions,” ABARES said, with drought hitting hard in Queensland, New South Wales and parts of Victoria.

September rainfall was “very much below average” in most cropping regions, with some posting record losses, while significant frost in southern New South Wales, Victoria, South Australia and Western Australia also hit production.

The revised figures mean that winter crop production in Australia is set to be 20 percent below the 20-year average to 2017, although it is still 69 percent above the lowest single production year during that period.

Winter crop production in Western Australia is expected to account for 56 percent of national production in 2018-19, far above the average level of 36 percent in the 20 years to 2017-18.

Looking at the major winter crops, ABARES has forecast that wheat production will fall by 20 percent to around 17 million tons, barley production will fall by 18 percent to approximately 7.3 million tons, and canola production will fall by 39 percent to around 2.2 million tons. In addition, chickpea production is forecast to decrease by 71 percent to 330,000 tons and oats production to fall by 21 percent to 888,000 tons.

In New South Wales, ABARES revised down its production forecast for the state to 3.137 million tons, down from its forecast of 3.887 million tons in September, a drop of 57 percent. Production in Victoria is set to fall by 51 percent and production in Queensland will decline by 45 percent, ABARES predicted.

“While production in New South Wales and Queensland is forecast to be the lowest in over 20 years, we expect national production to be substantially higher than in the droughts of 2002–03 and 2006–07,” said ABARES executive director Dr Steve Hatfield-Dodds.

“Above-average rainfall in October benefited crop prospects in southern New South Wales, southern Wimmera in Victoria, southern South Australia and Western Australia. However, it arrived too late in other regions to benefit winter crops.

“Winter crop area is estimated to have fallen by 20 percent in 2018–19 due to less area planted at the beginning of the 2018–19 winter crop season, and significant area planted for grain production in eastern states being cut for hay during spring.

“Prospects for summer crops will be highly dependent on sufficient and timely rainfall because of low levels of soil moisture in a number of regions,” he added.