Rain in parched areas of Western and South Australia, and more expected in the coming days, could add as much as a million tons to the country’s wheat harvest, according to analysts. The larger wheat production would help boost global supply after crop losses in Russia pushed Chicago futures prices to 10-month highs.
Australia is a major exporter of wheat, barley, and canola, and all three crops would benefit from the rains. While Australia’s eastern regions have had plenty of moisture, many farmers in the west and south have been planting seeds into dry earth and hoping for showers.
“Without the rain, we were heading for a reduction for wheat of half a million tons or more in Western Australia,” said Ole Houe, head of advisory services at IKON Commodities in Sydney. “With the rain, we might even add half a million. Our forecast is still more than 30 million tons and that number is probably growing now rather than shrinking.”
The rain in Western Australia would also stabilize the canola crop, as the state accounts for nearly half the country’s canola production. Farmers will also be encouraged to sow more seeds, which could result in Australia’s planted area being up to 5% larger than if no rain had come, said Andrew Whitelaw at agricultural consultants Episode 3 in Canberra.
Precipitation this week and next should add between 500,000 and a million tons to the national wheat harvest, according to Whitelaw. He noted that some eastern areas were now at risk of becoming too wet. Much of Western Australia’s crop belt and almost all of South Australia’s received rain this week, and more widespread rain should fall in the coming eight days, particularly in the west and the east, Australia’s weather bureau said.
Australia’s agriculture ministry is due to issue a quarterly crop report with its expectations for production on Tuesday, which should provide further insights into the improved harvest outlook.