Production

In 2015, wheat production is expected to decline by 14 per cent to 23.2 million tons, as a result of below-average rainfall and falling yields. The previous quarterly estimate of 24 million tons has been revised down based on an expected 16 percent decline in average yields due to lower soil moisture and adverse weather conditions. The downward revision in production comes despite a two percent increase in total harvested wheat area, to 13.8 million hectares.

Wheat is the major winter crop in Australia, with sowing starting in autumn and harvesting, in spring and summer. Harvesting starts in central Queensland during August and progresses down the east coast to Victoria, finishing during January. On the west coast, the wheat harvest starts during October and is completed during January. The main producing states are Western Australia, NSW, South Australia, Victoria and Queensland. Major types of wheat include Prime Hard, Hard, Premium White, Standard, Soft and Durum, based on protein, grain size and moisture content and each grain has different end-uses.

Consumption

Wheat is Australia's major grain crop and is used for human consumption in the production of breads, noodles and pastas. Lower quality wheat is used as stock feed while some waste wheat starch is used to manufacture biofuel. Australia typically consumes 5 million tons of wheat annually, with the remainder exported. Around 2.5 million tons are used to produce flour, whole grain products and beverages for human consumption, as well as to produce gluten and starch for industrial uses. A further 2.5 million to 3 million tons is used annually as stock feed. Half a million tons of wheat is used as seed.

Wheat consumption in Australia has been stable in recent years with around 70 kg of flour per capita consumed on average over the past decade. Flour producers face a mature domestic market with growth dependent on product innovations to supply market segments such as organic grains, or to meet dietary needs for gluten free and yeast free products. The biggest milling companies in Australia are Allied Mills, George Weston Foods and Manildra. The NSW complex of Manildra is one of the ten largest flour mills in the world and the leading Australian biofuels producer, using waste wheat starch for its feedstock.

Trade

In 2015, Australian wheat exports are forecast to fall to 17 million tons, down 8 per cent from the previous year as a result of lower production and yields. Sufficient stocks of wheat are available from the 2014 season to meet export commitments. The average export price for wheat is expected to fall in 2015, but this will be offset by the depreciation of the Australian dollar in early 2015.

Australia is the seventh largest wheat producer in the world and the fourth largest exporter. Around 80 per cent of Australian wheat production is exported, with WA the leading State. Australia has the capacity to export wheat in the December to May marketing window when the northern hemisphere season is ending. During this period, seasonal demand for grain, rail and port services and shipping slots increases significantly and a queuing system has been used for bulk grain exporters.

Around half of wheat grown in eastern Australia is consumed locally, while 90 per cent of grain produced in Western Australia and South Australia is exported. The major export markets are in the Asian and Middle East regions and include Indonesia, Japan, South Korea, Malaysia, Vietnam and Sudan.

Production, Supply and Distribution Statistics:

Wheat

2012/2013

2013/2014

2014/2015

Market Begin Year

Oct 2012

Oct 2013

Oct 2014

Australia

USDA Official

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USDA Official

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USDA Official

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Area Harvested

12,979

12,979

13,511

13,511

13,800

13,836

Beginning Stocks

7,051

7,051

4,654

4,654

6,242

6,249

Production

22,856

22,856

27,009

27,009

24,000

23,222

MY Imports

144

144

150

113

150

115

TY Imports

136

136

151

113

150

115

TY Imp. from U.S.

2

2

3

3

0

0

Total Supply

30,051

30,051

31,813

31,776

30,392

29,586

MY Exports

18,657

18,657

18,621

18,577

17,500

17,000

TY Exports

21,269

21,269

18,339

18,336

18,000

16,993

Feed and Residual

3,400

3,400

3,600

3,600

3,400

3,600

FSI Consumption

3,340

3,340

3,350

3,350

3,400

3,400

Total Consumption

6,740

6,740

6,950

6,950

6,800

7,000

Ending Stocks

4,654

4,654

6,242

6,249

6,092

5,586

Total Distribution

30,051

30,051

31,813

31,776

30,392

29,586

1000 HA, 1000 MT, MT/HA