Australia's MY 2022-23 wheat output forecast at record 36.6 mil mt

The Australian Bureau of Agricultural and Resource Economics and Science has scaled up its forecast for Australian wheat output for the 2022-23 marketing year (October-September) to a record-high 36.6 million mt, up from 32.2 million mt in its previous estimate, it said in a report Dec. 6.

According to the data, the output is slightly higher than the estimated 36.4 million mt for MY 2021-22.

Output is expected to increase due to adequate rainfall over recent months that led to increased soil moisture, traders said.

The wheat harvest is expected to be largest in Western Australia, followed by New South Wales, ABARES said.

In Western Australia, wheat production is estimated to reach 13 million mt, up from 11 million mt seen in the September update. In New South Wales, however, the output has been scaled down to 9.1 million mt against 10.2 million mt seen earlier.

"In New South Wales, the output is seen declining as excess showers have hit the standing crop in some places," a local trader said.

Australia's wheat acreage for MY 2022-23 was pegged at around 13 million hectares, largely unchanged year on year.

For wheat, market participants expect a smaller harvest of premium quantity wheat due to excessive showers during the harvesting season, it said.

Traders and analysts have estimated export shipments at around 27 million-28 million mt, largely at par with the previous year.

Though a big crop is expected, views on Australia's market share in the Asia-Pacific were divided, with Ukraine resuming exports. Although the country is only showing prompt September-October shipments and the market is generally well covered for those months, some buyers are waiting in line for offers for shipments starting from January before placing orders.

Australian wheat prices ease

Australian wheat prices are easing under record crop estimates. The Platts assessment of Australia Premium Wheat FOB Australia has declined 7% since Nov 1 to $360/mt Dec. 5. Australian standard white wheat, or ASW, fell 10% to $315/mt FOB Australia over the same period.

Harvest has been impacted by severe wet weather but the current dry conditions have helped farmers speed up collection. The largest producing states, Western Australia and New South Wales have reported a total of about 15 million mt of total grains.

According to the CBH website, total grain harvest at Albany, Esperance, Geraldton and Kwinana reached 10.4 million mt as of Dec. 4. Shipping records were broken with 1.54 million mt in November, beating previous records of 1.24 million mt in November 2021.

Graincorp reported on their website that total receivals from Queensland, Victoria and New South Wales were at 4.6 million mt as of Dec. 5.

Protein levels are reportedly better than expected in the East Coast though in Western Australia, the average protein for standard wheat quality will be under 9%. One source reported an average level as low as 7.6%.