Australia raises wheat crop outlook to third-largest on record

Australia is expecting to harvest its third-largest wheat crop on record in the current season, likely exacerbating a global supply glut of the important grain.

The year’s harvest is forecast at 35.6 million tonnes, according to the Department of Agriculture’s December quarterly report, almost two million tonnes higher than the previous survey and just narrowly missing its 2022-23 record.

The unexpectedly strong harvest is the result of higher-than-average rainfall and a mild spring across the country’s largest cropping states, including New South Wales and Western Australia, according to the report. However, drier conditions in the nation’s southeast may have prevented wheat production from hitting a record, the report added.

Overall, the Australian winter grain harvest for 2025-26 will be the second-highest on record, hitting 66.3 million tonnes. Barley output will be the largest yet at 15.7 million tonnes, while canola is expected to be strong as well, according to the Australian Bureau of Agricultural and Resource Economics and Sciences report.

Australia is one of the world’s largest exporters of wheat, alongside Canada, Russia and the US, with rapidly developing Southeast Asian nations among its biggest customers. However, it’s now faced with attempting to sell its near-record harvest into an already oversupplied global market, thanks to strong crops across Europe and North America.

Wheat prices fell to a five-year low in October off the back of bearish supply signals, before signs of a break in trade tensions between the US and China sent grain prices higher.