Forecasters predict drier weather following three years of record rainfall brought on by back-to-back La Nina weather patterns that led to record crop production in Australia. According to the June crop report from the Department of Agriculture, Fisheries and Forestry, the Australian winter crop production will fall by 34% to 44.9 million tonnes in 2023-24, around 3% below the 10-year average of 46.4 million tonnes.
There will be a drop of 34% in wheat production and a 30% drop in barley production, respectively, to 26.2 million tonnes and 9.9 million tonnes.
In both cases, the figures are lower than the 10-year average. There will be a fall of 41% in canola production to 4.9 million tonnes, but it will remain 15% above the decade average.
El Nino threat
According to the report, there is a high chance of below-average rainfall across cropping regions between June and August, which may be accompanied by El Nino conditions.
Food producers across Asia are at risk from El Nino's dry weather pattern, especially Australian wheat and palm oil production, as well as rice production throughout Southeast Asia.
Winter crop plantings will fall but remain historically high at 23.3 million hectares, with wheat and canola plantings down 2% and 11%, respectively. Because it can handle drier conditions better, barley plantings are set to rise by 4% to 4.3 million hectares.
The June agricultural commodities report issued by the same department projects that the total value of agricultural production will fall by 14% to A$79 billion ($52.08 billion) in 2023-24, still the third highest ever.
Lower production and easing global prices for grains and oilseeds will cause agricultural exports to fall 17% to A$65 billion in 2023-24.
During the same period, summer crop production, including sorghum and cotton, is expected to decrease by 8% to 5.1 million tonnes, but remain above average.
(With Inputs from Reuters)