Australia has never harvested so much barley before

Winter cereals have performed well in Australia. Abares estimates that the total harvest of winter crops will come in 35% above the ten-year average and is forecasting the third-largest wheat harvest ever in the country. In Ukraine, growers have sown more winter wheat than last autumn, according to preliminary data from the Ukrainian Ministry of Agriculture. Reports of large harvests are weighing on prices, and according to some traders, the physical market is deviating from the futures market in certain areas.The December wheat contract on Matif closed yesterday €0.50 lower at €186.75 per ton. On the CBoT, wheat also slipped slightly by ¾ cent to $5.30¼ per bushel. Corn closed 2¾ cents lower at $4.32¾ per bushel. The biggest decliner on the Chicago exchange was soybeans, down 9¾ cents to $11.28 per bushel.Australia is heading for the second-largest winter crop harvest ever. This was reported by Abares (the Australian Bureau of Agricultural and Resource Economics and Sciences, part of the Australian Ministry of Agriculture) in the December Crop Report. The total winter crop harvest is estimated at 66.3 million tons, which is 35% above the ten-year average.More than half of that volume is wheat, at 35.6 million metric tons. The wheat estimate has been revised upward by 1.8 million metric tons compared to the previous forecast and is now the third-largest harvest ever. The estimate for barley has been raised by 18% to a record harvest of 15.7 million metric tons.The expected rapeseed harvest has also been sharply increased—up 13% to 7.2 million tons. In Western Australia (the largest growing area), wheat yields average 3 metric tons per hectare, while farmers harvest on average 3.8 tons of barley and 2 metric tons of rapeseed per hectare.Abares writes that the winter crop harvest is progressing steadily, and yields for these crops can now be reasonably well assessed. For crops sown in the spring, however, the statistics office remains cautious. Conditions for sowing were good during the Australian spring, but now that it is summer, more rain is needed to realise the full potential of the spring-sown crops. Especially the later-sown fields still have a long way to go.More wheat sownUkraine yesterday released its first forecast for the 2026 wheat harvest. According to Deputy Minister Taras Vysotskiy, next summer’s wheat harvest could reach 24 to 25 million metric tons. Last summer, Ukraine harvested 23 million metric tons of wheat.The larger harvest is linked to an expansion of the wheat area. This autumn, 4.7 million hectares of winter wheat were sown, compared with 4.4 million hectares last season. In total, 6.43 million hectares of winter crops have been sown, according to the Ministry of Agriculture. This means 98% of the planned area is now in the ground.Grain exports from the past harvest have been slow to pick up in Ukraine. So far this season, 12.14 million metric tons of grain and pulses have been exported, according to the Ministry. That is 32% behind the same period last season. In November, 2.76 million metric tons were exported, 23% less than in the same month a year earlier.Farmers offer little supplyHigher yield estimates—such as those now seen in Australia and Ukraine—are less favourable for prices. Some traders on the physical market are noticing this. Several arable farmers are in no hurry to sell at current price levels. The likelihood that prices will rise later in the season is considered greater than the chance they will fall further. Some sources report that, as a result, a situation is emerging where—in a market that should have ample grain available—certain traders are struggling to actually buy grain.