With the harvest already underway in Queensland, production estimates for Australia's new wheat crop are holding around 22 million tonnes, with some upside risk, industry participants said Friday.

 

Recent cool weather allied with some rainfall suggests crops in many areas are experiencing "a soft finish" to the growing season, which means forecasts in early September for many crops, including in New South Wales, were a little pessimistic, Brett Stevenson, a risk management advisor at grain market consultancy MarketCheck, said by telephone.

 

"We're probably up closer to 23 million tonnes now, from the 20.5 million tonnes estimated early in September,'' he said.

 

National production in the previous crop year ended March 31, 2009, reached 21.4 million tonnes, according to the government's Australian Bureau of Agricultural and Resource Economics (Abare).

 

Two-thirds of the harvest was available for export, making Australia a major supplier to the global trade and earning exporters about A$5 billion (US$4.5 billion).

 

Abare's current new crop forecast stands at 22.7 million tonnes, including an estimate for South Australia of 3.5 million tonnes.

 

Stevenson suggested South Australia's crop could yet surpass a record 4.8 million tonnes achieved in the 2001-02 crop year.

 

"I don't know how much better weather conditions you can give to an area of the country than what South Australia has received this year," Stevenson said. "It has had an absolutely perfect run."

 

Rob Hughes, who as principal of Rob Hughes Agencies Pty Ltd. has been trading grain at Tailem Bend east of Adelaide for more than four decades, said many crops in the state "are looking a picture."

 

Output "may not" reach the record but everyone's still expecting pretty good crops, he said.

 

This year, based on a comparison to previous years, Keith Perrett, chairman of Grains Research & Development Corp. and chairman of the government's National Rural Advisory Council, estimates national wheat output will be around 22 million tonnes.

 

Speaking from Gunnedah town in northern New South Wales, Perrett said there are some "fantastic" crops in the state but as per usual the overall picture is patchy and the southwest is "a basket case."

 

Southern Queensland is "a mixed bag" with some crops facing a hard finish to the growing season, he said.

 

"There is some really good stuff in Victoria and my guess is that it will be well up on where it's been in the past few years," he said.

 

Abare estimates output in Victoria at 2.7 million tonnes.

 

Farmers can now enjoy much better yields thanks to modern farming technology and systems, and improved seed varieties, which is helping underpin Perrett's output estimate.

 

His property received 200 millimetres of rainfall during the growing season - half the long-term average - and he predicts yield will reach 2.5 tonnes a hectare. Another 30 mm during the growing season would have taken this to four tonnes/hectare, he said. A long-term statewide yield average is 1.44 tonnes/hectare.

 

"We were just that little bit short all the time," he said.

 

Recent official estimates for Western Australia could be "wildly optimistic," according to Shane Sander, a risk management adviser at Western Australia-based commodity manager AGvise.

 

"There's not as much wheat in Western Australia as what the forecasters are saying," he said by telephone from the central wheatbelt town of Merredin.

 

On Tuesday (Oct 6), Western Australia's Department of Food and Agriculture upgraded its estimate of new crop wheat production to a range nine million-10.5 million tonnes, from last month's estimate of 7.5 million-nine million tonnes.

 

"Cool conditions and no frost for the next two to four weeks could see the upper end of the forecast being reached," the department said in the update.

 

Abare's forecast for Western Australia is 8.7 million tonnes, but Sander said talk in the trade is more focused on a yield around eight million tonnes.

 

The area planted is down this year due to late planting rains, he said.

 

"While it's been a mild finish temperature-wise, there hasn't been enough rain in it," he said.