Australia’s Wheat Harvest Set to Hit 3-Year Low Amid Iran War Costs
Australia’s wheat production is forecast to fall to its lowest level in three years as rising fertiliser costs linked to the Iran war and ongoing dry weather reduce planting and crop yields. Government agency ABARES expects the country to produce 26.7 million metric tons of wheat this season, around 9 million tons lower than last year’s harvest. Farmers are also facing below-average rainfall and possible El Nino conditions across key growing regions. Lower Australian wheat output could tighten global grain supplies further and support higher crop prices after recent production losses in the United States.
The outlook for Australia’s wheat harvest is its lowest in three years, with rising fertiliser costs likely to reduce planting and lead to dry weather.
Key Highlights
- Australian wheat harvest now expected at 26.7 million tons
- Wheat production set to shrink by some 9 million tons from last season
- Inflated fertiliser prices due to Iran conflict hitting farmers
- Dry conditions and El Niño risks linger across eastern Australia
- Winter Wheat Planting Area Estimated Down 12 Per cent This Season
Wheat Production Forecast Drops Sharply
According to the Australian Bureau of Agricultural and Resource Economics and Sciences, Australia will harvest just 26.7 million metric tons of wheat later this year, the country's lowest crop in three years.
The forecast is roughly 9 million tons below last season and approximately 8 million tons under the five-year average. As a huge wheat producer, lower production in Australia will restrict supplies in the world market, and prices will remain high.
Farmers Strain Under Iran War, Fertiliser Costs
ABARES said the Iran war disrupted deliveries from Gulf nations, pushing global fertiliser prices. This may limit the availability of farm fertiliser that farmers can use, which could in turn restrict optimism for crop yield potential across many major cropping areas, due to higher input costs.
Conversely, most of eastern Australia has endured months of below-average rainfall. While May rains had resulted in better crop prospects, the Bureau of Meteorology still foresees response to latest season El Niño conditions and below-median rainfall for months ahead.
Planting Falls As Farmers Shift Crops
ABARES estimates planted area for wheat will drop 12% from last season to 10.9 million hectares, the lowest since the 2019/20 season.
Barley sowings are forecast up 4% due to the crop being less fertiliser hungry than wheat, although the output is still set to fall 15% to 14.1 million tons. This will be the biggest fall in area for any crop as planting operations continue, meanwhile canola plantings are seeing a 6% fall and production is seen halving to millions of tons.
FAQs
- Why is Australian wheat production falling?
High fertiliser prices and dry weather are leading to a shrinking area and subpar yields.
- What is the impact of the Iran war upon Australian farmers?
The conflict has led to outages of fertiliser from the Gulf nations, causing costs to surge.
- Which weather risks are threatening the crops?
It is dry and possible El Niño weather patterns are influencing rainfall outlooks.
- When is Australia getting its wheat crop?
With planting still to be completed, harvest is not expected until later this year.
Follow Inspirepreneur Magazine for daily global business news.