The Australian Bureau of Agricultural and Resource Economics and Science, or ABARES, raised its marketing year 2022-23 (October-September) forecast for Australian wheat output to a record high 39.2 million mt, from a prior estimate of 36.6 million mt in December, the bureau said in its quarterly report March 7.
The output is 7.7% higher than 36.4 million mt estimated for MY 2021-22, according to the bureau.
Australia's wheat exports are also seen rising to 28 million mt, from 27.5 million mt in the previous year, on the back of higher output, ABARES said.
The country's wheat production is expected to rise following adequate rainfall over the recent months that increased soil moisture.
"Record yields in Western Australia and South Australia have caused a greater occurrence of grain yield dilution, which has contributed to below average protein levels in wheat," the ABARES report said.
The wheat harvest is expected to be the largest in Western Australia, followed by New South Wales, ABARES said.
In Western Australia, ABARES now estimates full-year wheat production at 13.8 million mt, up from December's forecast of 13 million mt. In New South Wales, the output has been raised to 10.3 million mt, from 9.1 million mt earlier.
"Wheat harvested in Queensland, northern New South Wales and much of Victoria have generally seen less of a downgrade than those harvested in central and southern New South Wales," the report said.
Excessive flooding had led to crop quality downgrade concerns. However, the impact has been limited to some areas, traders said.
ABARES pegged Australia's wheat acreage for MY 2022-23 around 13 million hectares, largely unchanged year on year.
Australia prices slide due to harvest pressure
FOB Kwinana Australia Premium White milling wheat prices have been under pressure with the harvest looming. The APW FOB price dropped about 15%, or $57/mt, to $330/mt Mar 7, from Nov 1, according to the Platts assessments from S&P Global Commodity Insights.
The marketing year for wheat in Australia starts from October. In 2022, a delay in the harvest due to persistent precipitation and widespread expectations of protein downgrade had supported APW prices.
Australian wheat may continue to see pricing pressure as the new Black Sea crop returns, but buyers have been worried about shipment security with the Black Sea Grain Initiative expiring March 18.
