Wheat production

IBISWorld expects national wheat production to decrease by 35.8% in 2023-24 to 26.0 megatonnes. Wheat production is highly volatile, depending on favourable weather conditions, like annual rainfall. Wheat quality typically deteriorates when weather conditions are unfavourable, like when there is too little rain during spring. Wheat production has increased over the past five years, mainly because of well-timed rainfall, which has led to record crops over the three years through 2022-23. However, flooding in many regions in Australia's eastern states in Spring 2022 caused substantial damage to some growers' crops, affecting wheat production in the succeeding years.

Favourable growing conditions can lead to significant production yields. For instance, growing conditions were ideal for wheat farmers in much of the country in 2016-17 because of high rainfall. This helped boost wheat production that year, resulting in a surge in production. Conversely, decreased annual rainfall reduced wheat production in 2017-18 and 2018-19, especially on the east coast. A substantial increase in annual rainfall contributed to a substantially large wheat crop in 2020-21, with production volumes more than doubling over the previous year. High annual rainfall in 2021-22 and 2022-23 continued to drive production volumes to record levels.

Prolonged drought conditions contributed to consecutive sharp declines in wheat production over the two years through 2019-20. These drought conditions constrained water availability, limiting agricultural irrigation water usage. Wheat growers often use irrigation water when rainfall levels are low, and the low agricultural irrigation water usage has hindered wheat production over the past two years, from 2019 to 20. Above-average rainfall and better weather conditions over the three years through 2023-24 have led to substantial growth in wheat production volumes. Overall, IBISWorld forecasts national wheat production to rise at a compound annual rate of 8.1% over the five years through 2023-24.