Crop expected to nudge 50mt

And general manager for agribusiness at Rural Bank and Rural Finance Andrew Smith said there was the potential for further upside from the forecast of 49mt.

“We may have room for further upside yet, we are just being a little conservative until we see the extent of the water damage, principally in central west NSW,” he said.

The big year on year gains will be in Victoria, expected to have a crop double the size of last year’s drought impacted season and Queensland, expected to rise 25 per cent.

The report also flags Western Australia to remain on track for above average yields in spite of frost damage lowering total production expectations.

Mr Smith said although the spring rain caused isolated pockets of damage, in general it had been excellent for crop production.

 “With a 15-year high in crop vegetation density during the growing season in most parts of Australia, the potential for a bumper season is certainly there this year.”

Of the major crops, wheat production is expected to rise 16pc to 28mt, barley will go up 11pc to 10mt and the major yield gains will be in canola, up 23pc to 3.5mt and chickpeas up 21pc to 1.2mt.

Mr Smith said he would be watching the pulse production with interest.

“There has been crop abandoned but equally there have been some very good yield reports in Queensland where the crop did not get too wet.”

Mr Smith said canola and pulses would not only be the success stories in absolute yield gains but in gross margins too.

“The cereal prices aren’t providing any great excitement but canola and pulses are at historically good levels.”

While cereal prices are low, Mr Smith said he expected growers to at least achieve milling grades with wheat.

“There was concern around crop quality earlier on, especially after all that rain in the spring, but it is shaping up fairly well.

“The early comments are that protein will be down, which is to be expected with such big yields about, but at this stage we don’t expect there to be widespread downgrading in the cereal crop.”

“There have been some issues with black tip reported, primarily in barley, but overall things are holding up well.”

Mr Smith nominated Central Queensland and the Victorian Mallee as cropping regions that could threaten record tonnages this year.

“There are a lot of good crops this year but those areas that generally are a bit lighter on for rainfall have had near perfect seasons.”

In terms of storage patterns, Mr Smith said there had been very strong demand earlier in the season for grain bags and silos.

“People have got as much cover as they can so if they want to store grain on-farm in the hope of a price rise they can.

“However, it was difficult to get any type of storage system late in the growing season so some farmers will have no choice but to deliver into the bulk handling system somewhere.”