Australia forecasts 34% decline in wheat production

Australia’s wheat production for 2023/24 will drop by double digits from last year, Gro’s machine-learning model predicts.

A weaker crop from the world’s No. 4 wheat exporter would represent a blow to wheat importing countries such as Indonesia, Vietnam, and China, at a time of harvest shortfalls in the US, Canada, the EU, and China, and Russia’s renewed blockade of Ukrainian shipments. 

ABARES, an Australian government agency, has forecast a steep 34% decline in this year’s wheat production, partly in anticipation of a strengthening El Niño weather pattern. El Niño events tend to bring more arid conditions to Australia’s wheat growing regions, which typically drag down yields.

Gro’s Australia Wheat Yield Forecast Model, which doesn’t take into consideration the future impact of this year’s El Niño, is currently predicting wheat yields will be lower than last year, but not to the degree ABARES projects. A Gro analysis shows that past El Niños have brought conflicting results to Australia’s wheat crops, suggesting it is too soon to assume production will decline substantially. 

View this Gro display that assesses the intensities of past El Niño events against Australia’s annual wheat production. 

For example, a strong El Niño event in 2015-16 only reduced that season’s Australia’s wheat production by a modest 6% from the previous year. In contrast, a much weaker El Niño in 2018-19 resulted in a steeper 16% drop in wheat output. Another El Niño, classified as moderate-to-strong, occurred in 2009-10, and wheat production for that season actually rose slightly. 

Gro’s Australia Wheat Yield Forecast Model, which provides estimates for in-season yields at the sub-state level, went live in mid-July. The machine-learning model uses weather, vegetative health, soil data, and other environmental features to continuously forecast final end-of-season yields.

Currently, Gro’s vegetative health index for Australian wheat is above the two-decade average, signaling a strong crop, as seen in Gro’s Climate Risk Navigator for Agriculture. In addition, the Gro Drought Index reading is low and soil moisture levels, while below average, are still adequate. 

However, weak rainfall could begin degrading the crop’s health. Accumulated precipitation across Australia’s wheat fields since April is 29% below the 10-year average, as shown by the Gro Climate Risk Navigator. 

For the past three seasons, Australia has benefited from La Niña bringing above-normal rainfall to wheat growing areas. The country saw back-to-back bumper harvests from 2000 to 2022. Wheat, Australia’s largest cereal crop, is grown largely in the states of Western Australia, South Australia, Victoria, and New South Wales. The crop is planted starting in April and harvested beginning in November.

Tags: Australia, wheat, crop forecast