Australia lifts crop production estimates after summer rains

CANBERRA, March 4 (Reuters) - The Australian agriculture ministry on Tuesday raised its estimate for the country's 2023/24 winter wheat harvest by about 500,000 metric tons to 26 million tons, while also lifting its assessments for canola, sorghum and cotton production.

The size of Australia's harvests is important for global markets because the country is one of the world's biggest agricultural exporters and will ship most of its crops overseas.

Better-than-expected summer rainfall has boosted yields, the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) said in a quarterly report.

However, harvests of most crops remain much smaller than in recent seasons because of an El Nino weather phenomenon that brought hot and dry weather for much of 2023.

For winter crops, whose harvest is now complete, the bureau estimated that 26 million tons of wheat, 10.8 million tons of barley and 5.7 million tons of canola were produced in the 2023/24 season.

Three months ago, it forecast harvests of 25.5 million tons of wheat, 10.8 million tons of barley and 5.5 million tons of canola.

Overall, winter crop production is down 32% from 2022/23 but roughly in line with Australia's 10-year average to 2022/23, ABARES said.

For summer crops due to be harvested in the coming months, ABARES said Australia would produce 2 million tons of sorghum, 1 million tons of cotton and 555,000 tons of rice.

Its previous forecasts were for 1.5 million tons of sorghum, 925,000 tons of cotton and 700,000 tons of rice.

Total summer crop production is likely to be 17% below 2022/23 levels but 22% above the 10-year average, the bureau said.

ABARES raised its estimate of the value of 2023/24 crop production by A$2 billion ($1.3 billion) to A$48 billion and said the total value of farm output excluding fishing and forestry would be A$80 billion, down 15% from 2022/23.

It said more favourable weather should increase crop yields in 2024/25 but that inventory rebuilds are likely to reduce exports and that it expects grain prices to decline.

($1 = 1.5314 Australian dollars)

(Reporting by Peter Hobson; Editing by Christopher Cushing)