Australia: Barley output forecast to increase by more than 15% in 2020/21

Australia raised its estimate for wheat production in the 2020/21 season by more than 25% on June 10 after recent heavy rains broke a three-year drought that has ravaged the country's east coast.

The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) said wheat production for the year ending June 30, 2021 will total 26.7 million tonnes, up from its March estimate of 21.3 million tonnes.

Peter Gooday, acting Executive Director of ABARES, said the higher forecast reflected "very favourable" conditions across Australia's eastern states and South Australia.

Should the higher wheat production materialise, it would likely weigh on global prices.

Australia is among the world's top 10 exporters of the grain, which typically contribute about 2% to the country's gross domestic product.

The weather conditions mark a stark change for Australia's east coast which had until earlier this year seen record low levels of rain, leaving bushland tinder-box dry which was then razed by deadly bushfires.

Heavy rains eventually extinguished those fires, and ABARES said moisture in the soil encouraged farmers to sow more crops.

ABARES said just shy of 13 million hectares (32.1 million acres) of wheat had been planted, about 8% higher than Australia's chief commodity forecaster anticipated in March.

And with more wet weather expected over the next three months at least, ABARES also raised it yield forecast.

The rains will also boost barley production, ABARES said.

Barley output during the 2020/21 season will total 10.6 million tonnes - up more than 15% from its previous estimate of 9.1 million tonnes in March.

The larger production, however, comes as Australian barley exports face bleak export prospects after China imposed more than an 80% tariff on Australian supplies last month.

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