Australia: Wheat Dominates as Planted Areas Expand, Challenging Season Ahead for Canola and Pulses
Source: The DairyNews
According to Rabobank, the total planted area for the Australian 2024/25 agricultural season is expected to increase by 3.6% to 23.55 million hectares, driven by positive projections in New South Wales and Queensland and improved year-on-year margins. This expansion is set to favor wheat, with the total area dedicated to winter wheat projected to grow by 961,000 hectares, or 7.7% year-over-year, reaching 13.48 million hectares.
Conversely, canola is anticipated to contract by approximately 450,000 hectares, a 12.7% decrease from the previous year, largely due to less favorable conditions and lower gross margins in Western Australia and South Australia. Barley planting is expected to secure the second-largest growth, increasing by 5.1% year-over-year or 210,000 hectares, totaling 4.33 million hectares. Oats are projected to see a slight increase of 12,000 hectares, bringing the total to 0.7 million hectares, while pulses are set to expand by 5.2% year-over-year to 1.93 million hectares.
Despite a challenging start to the season in Western Australia, South Australia, and western Victoria, a mid- to late-season recovery is anticipated, largely due to expected better rainfall from La Niña. Overall winter crop production is forecasted to reach 46.3 million tonnes, including 27.4 million tonnes of wheat (up 5.7% year-over-year), 10.0 million tonnes of barley (down 7.2% year-over-year), and 5.0 million tonnes of canola (down 11.4% year-over-year). Oats and pulses are projected to experience declines in production, dropping by 6.1% and 10.8% year-over-year to 0.96 million tonnes and 2.8 million tonnes, respectively.
The price outlook for the upcoming harvest has improved significantly since early May, particularly for wheat, both in Australian and overseas markets. This improvement follows substantial losses in global wheat supply due to adverse weather conditions in the Black Sea region. The 2024/25 season is expected to be the fifth consecutive season with a decline in global ending stocks of wheat.
In the vegetable oil sector, canola prices have also increased, spurred by stronger demand from the EU crushing sector and changes in the global renewable fuel market triggered by new U.S. policies. Meanwhile, the pulse market sees potential uplifts following India’s removal of import tariffs on certain legumes, which could influence global pulse trade dynamics.
Despite a challenging start to the season in Western Australia, South Australia, and western Victoria, a mid- to late-season recovery is anticipated, largely due to expected better rainfall from La Niña. Overall winter crop production is forecasted to reach 46.3 million tonnes, including 27.4 million tonnes of wheat (up 5.7% year-over-year), 10.0 million tonnes of barley (down 7.2% year-over-year), and 5.0 million tonnes of canola (down 11.4% year-over-year). Oats and pulses are projected to experience declines in production, dropping by 6.1% and 10.8% year-over-year to 0.96 million tonnes and 2.8 million tonnes, respectively.
The price outlook for the upcoming harvest has improved significantly since early May, particularly for wheat, both in Australian and overseas markets. This improvement follows substantial losses in global wheat supply due to adverse weather conditions in the Black Sea region. The 2024/25 season is expected to be the fifth consecutive season with a decline in global ending stocks of wheat.
In the vegetable oil sector, canola prices have also increased, spurred by stronger demand from the EU crushing sector and changes in the global renewable fuel market triggered by new U.S. policies. Meanwhile, the pulse market sees potential uplifts following India’s removal of import tariffs on certain legumes, which could influence global pulse trade dynamics.
