3 weeks ago
Australian Wheat Crop Rebounds Amid Tightening Global Grain Supply
Farmers in Australia grow a lot of wheat, which is used to make bread and pasta.
This year, they were very worried because they expected hot, dry weather and shortages of fuel and fertilizer.
But lots of rain fell in the first half of the year, so the wheat is growing surprisingly well.
Because of this, experts have raised their predictions for Australia's crop.
The crop will still be smaller than last year, but bigger than usual.
This is important because other countries are struggling to grow and ship wheat.
A war between Russia and Ukraine has blocked many grain ships, and very hot weather has hurt wheat in the United States, Canada and Europe.
World wheat prices went very high in July, and big countries like Indonesia and the Philippines may buy more from Australia.
Still, a hot, dry weather pattern called El Niño could arrive later this year, so some farmers plan to grow sorghum instead of wheat.
Well-timed rain across New South Wales, Queensland and Victoria has brightened Australia's 2026 wheat outlook, with Rabobank raising its forecast from a low of 21.3 million tons to as much as 30 million tons.
The rebound comes as global wheat supply tightens due to Black Sea shipping disruptions from the Russia-Ukraine war and heat waves across the United States, Canada and the European Union.
Australia's expected crop remains below last year's 35.8 million tons but above its 10-year average, and could help fill gaps for importers such as Indonesia, the Philippines and potentially China.
Fears of fuel and fertilizer shortages driven by the war in Iran have eased, with Australian diesel prices down about 25% from their April peak.
Uncertainty remains because a significant El Niño is still forecast for the second half of the year, and Queensland farmer Arthur Gearon said he may abort wheat in favor of planting sorghum.
- Who
- Australian farmers and analysts, including northeastern Victoria farmer Julia Hausler, Queensland farmer Arthur Gearon, and forecasters at Rabobank, Bendigo Bank Agribusiness and Commonwealth Bank of Australia.
- What
- Australia's 2026 wheat crop outlook has improved sharply after well-timed rainfall, with forecasts upgraded to about 30 million tons, helping buffer a worsening global wheat supply situation.
- Where
- Australia, mainly the eastern states of New South Wales, Queensland and Victoria, amid global supply disruptions in the Black Sea and heat-affected areas in the United States, Canada and the European Union.
- When
- Reporting on the 2026 crop after strong rainfall in the first six months of the year; Chicago wheat futures hit a two-year high in July, and wheat harvest typically begins in October.
- Why
- Because a well-watered Australian crop can help offset constrained global wheat exports caused by the Russia-Ukraine war's impact on Black Sea shipping and extreme heat across major Northern Hemisphere producers.
Optimistic Outlook
Cautious Outlook
El Niño risk to the crop
Optimistic Outlook
Some farmers, such as Julia Hausler, say there has already been enough rainfall for crops to mature without the usual spring showers, and they are 'tracking quite well' despite the challenges.
Cautious Outlook
A significant El Niño is still forecast to bring high heat and little rain in the second half of the year; Queensland farmer Arthur Gearon, who used an AI application to calculate rain chances and disliked the results, plans to abort wheat and plant sorghum instead.
Wheat price direction
Optimistic Outlook
Farmers say current prices do not reflect the rest of the world's grain supply shrinkage, given the tight global outlook.
Cautious Outlook
Analyst Rod Baker says Australia's improving crop outlook, along with large carryover supplies, has put downward pressure on US wheat futures, which neared a one-month low this week.
Key facts
- Rabobank forecast (May)
- As low as 21.3 million tons
- Rabobank upgraded forecast
- As high as 30 million tons
- Bendigo Bank Agribusiness forecast
- About 30 million tons, with upside to 33 million tons
- Previous year's Australian crop
- 35.8 million tons
- Australian diesel prices
- Down about 25% from April peak
- Chicago wheat futures
- Two-year high in July; near one-month low this week
- Wheat harvest timing
- Typically begins in October
- El Niño forecast
- Significant event expected in the second half of the year
Quotes
Julia Hausler
Farmer in northeastern Victoria
“"We’re tracking quite well with the challenges that have been thrown at us. The only challenge you have now is the prices are not reflecting the rest of the world’s sort of shrinkage situation."”
livemint.com
Sources
Related news
Australia Lifts Wheat Forecast as Black Sea Demand Grows
Wheat Prices Reach Three-Year High as Black Sea Crisis Deepens
Wheat Climbs Ahead of USDA Report on Tightening Grain Supply
Wheat Hits Three-Year High as Russia Prepares to Escalate War
Global food prices hit three-year high as supply fears build
Chicago Wheat Falls as Turkey Revives Black Sea Grain Plan
Maharashtra, Australia Plan Biomanufacturing Task Force for Joint Growth
India Replaces Sri Lanka as 2027 Women’s Champions Trophy Host
Mitsubishi Revives Pajero With 201PS Fifth-Generation SUV
IIM-Born CEO Says Australia’s Everyday Life Runs on Trust
UN Report Says 1.5°C Overshoot, Return Remains Possible
