September 3, 2012

Australia's 2012-13 wheat yields may drop to 25 million tonnes 

In the next marketing year, Australia's wheat output will likely fall to 25 million tonnes from a record 29.5 million tonnes the previous year, but may still be above expectations.

Western Australia has suffered a prolonged spell of dry weather, with many analysts forecasting the country's overall production in the year that starts September 1 will fall to between 21 million-23 million tonnes.

Canberra-based agricultural consultant Mike Darby said good and timely rains in Eastern Australia will partly offset reduced output in the west. "If the average rains are received in September and October, Australia can still reach 25 million tonnes," he said on the sidelines of an industry conference.

A marked improvement in water-use efficiency in Western Australia in recent years is also curbing output losses, he said.

Australia's wheat exports will likely be around this year's 23 million tonnes in 2012-13 on the back of large carryover stocks and slow growth in domestic animal feed demand.

"Droughts in several years of the previous decade have stunted growth of the livestock and dairy industry, and demand for wheat as animal feed is limited despite the rise in output," Darby said.

After droughts in the US and the Black Sea region this year, normal output in Australia, one of the world's largest exporters would help tame rising prices.