Wheat Crop in Australia Cut 25% by Drought

Drought in Australia’s New South Wales, usually the nation’s second-largest wheat grower, has cut the state harvest by at least 25 percent, the government said.

“It is estimated that the dry weather has already cut the state’s wheat crop by 25 percent and every day without rain means more of the crop is lost,” New South Wales Minister for Primary Industries Ian Macdonald said in an e-mailed statement today. That equals about 1 million tons of wheat lost, he said.

Rain in September is crucial for growers in Australia, who planted a record wheat area, to boost yields before the harvest from November.
Hot, dry weather in eastern parts of Australia and the possible return of El Nino have raised concerns the nation’s grain output may miss forecasts.

About 66 percent of New South Wales has been declared drought-affected compared with 64 percent a month ago, as the state experiences below-average rainfall, Macdonald said.

“What started out as a promising winter crop season is again failing due to the lack of winter rainfall,” he said. “Some crops have already failed and those remaining are stressed and in desperate need for good soaking rain.”

Wheat prices have slumped 66 percent from last year’s record high on expectation the world’s farmers will produce the second-largest crop on record. Australia’s government commodity forecaster last week raised its estimate for the current wheat crop 3.2 percent to 22.7 million tons and forecast overseas shipments at a four-year high. Output last year was 21.4 million.

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