Research

Australian 2026/27 winter crop forecast: Production and grain prices

9 October 2026 20:05 RaboResearch

Total production is forecast to fall 7.9% YOY, as east coast losses and lower wheat output outweigh stronger crops in South Australia and Victoria.

Intro

    Australian winter crop production for the 2026/27 season is forecast to decline by 7.9% year-on-year to 62.9m tonnes, although this remains 2.6% above the five-year average. Production is more concentrated in southern and western regions due to sharply contrasting seasonal conditions. Below-average rainfall across the northern east coast is expected to reduce output in QLD and NSW. By contrast, favourable moisture and strong yields are supporting production increases in SA and VIC. In WA, mixed seasonal conditions are driving a year-on-year production decline, although output remains above the historical average. The season has also been marked by warmer-than-average conditions and minimal frost damage. This year, wheat production is forecast to fall by 13.3% to 31.1m tonnes, 9.7% below the five-year average. Lower output in QLD, NSW and WA will be partly offset by above-average crops in SA and VIC. Despite adequate global supply, Black Sea disruptions have reduced export availability and increased prices and freight costs. Combined with Australia’s freight advantage into Asia, this should support local port prices relative to overseas benchmarks. The east-west supply imbalance may also encourage grain movements from WA and SA into eastern livestock markets. Barley production is forecast at 16.5m tonnes, down 1.2% year-on-year but 16.8% above the five-year average, making it the second-largest crop on record. Abundant supply is likely to pressure prices at harvest before exports support a recovery in Q1 of the following year. Higher US corn prices, lower European cereal production and shipping disruptions are improving barley’s competitiveness, particularly if El Niño reduces east coast sorghum production and tightens domestic feed-grain supply. Australian canola production is forecast to rise by 5.3% to a record 8.1m tonnes, 15.5% above the five-year average. WA will account for 59% of national output, supported by a 41% increase in planted area. Global consumption growth is expected to outpace production, while stronger biofuel demand should reduce stocks and support canola prices. High fertiliser, diesel, agrochemical and freight costs continue to compress margins. Supply disruptions are raising phosphate and diesel costs, prompting growers to reduce fertiliser use, bring purchases forward and expand diesel storage. These measures reduce near-term exposure but may constrain working capital, while further shipping restrictions could intensify input-supply and trade risks.

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