Australia Grain Outlook 2025/26: Wheat and Sorghum Rebound, Rice Plunges on Water Shortage
📍 Executive Summary
- Following a dry autumn, widespread July rains improved winter crop conditions.
- Wheat and barley production forecasts remain above the 10-year average.
- Sorghum continues its upward trend, with exports to China leading demand.
- Rice faces a 33% production drop due to low irrigation storage, cutting exports sharply.
🌾 1. Wheat Market Overview
| Indicator | 2024/25 | 2025/26 (f) |
|---|---|---|
| Production | 34.1 MMT | 31.0 MMT |
| Exports | 23.0 MMT | 25.0 MMT ↑ |
| Domestic Consumption | 8.0 MMT | 8.1 MMT ↑ |
| Ending Stocks | 6.25 MMT | 4.38 MMT ↓ |
| Yield | 2.61 t/ha | 2.48 t/ha ↓ |
- Rainfall in July turned around a difficult start for southern states.
- Despite reduced planted area, higher carry-in stocks support exports.
- Feed demand is rising, led by expanding beef feedlot operations.
🍺 2. Barley Market Overview
| Indicator | 2024/25 | 2025/26 (f) |
|---|---|---|
| Production | 13.3 MMT | 13.0 MMT |
| Exports | 7.5 MMT | 6.5 MMT ↓ |
| Domestic Use | 6.0 MMT | 6.1 MMT ↑ |
| Ending Stocks | 0.88 MMT | 1.28 MMT ↑ |
- Area expanded to 4.8 million ha as growers switched from wheat during dry seeding conditions.
- Export dip reflects high 2024 shipments, reducing stock for 2025.
- China accounts for ~75% of exports post-tariff removal.
🌽 3. Sorghum Market Overview
| Indicator | 2024/25 | 2025/26 (f) |
|---|---|---|
| Production | 2.33 MMT | 2.50 MMT ↑ |
| Exports | 2.30 MMT | 2.40 MMT ↑ |
| Domestic Use | 60,000 MT | 60,000 MT |
| Ending Stocks | 0.10 MMT | 0.14 MMT |
- Planted area rising to 670,000 ha due to high demand from China (90% of exports).
- U.S. sorghum faces 22% Chinese tariffs, boosting Australia’s competitiveness.
- Yields projected slightly lower (3.73 t/ha) but still 17% above 10-year avg.
🍚 4. Rice Market Collapse (Irrigation-Driven)
| Indicator | 2024/25 | 2025/26 (f) |
|---|---|---|
| Production (milled) | 343,000 MT | 230,000 MT ↓33% |
| Exports | 230,000 MT | 170,000 MT ↓26% |
| Imports | 260,000 MT | 270,000 MT ↑ |
| Domestic Use | 410,000 MT | 420,000 MT ↑ |
- Low dam levels and competition from cotton drastically reduce the planted area.
- Industry pivoting away from high-volume targets; peak now capped at ~500,000 MT.
- Imports from Thailand, India, and Vietnam cover broad grain types unavailable domestically.
📈 Export Outlook: China Drives Demand, Risks Remain
- Wheat: Slow MY 2024/25 exports led to stock buildup. MY 2025/26 boosted by carry-in.
- Barley: After record shipments, limited supply caps 2025 exports.
- Sorghum: Trade with China is strong, but the market is near full capacity.
- Rice: Export potential shrinks; import reliance rising.
🌦 Weather Outlook
- Above-median rainfall forecast through October 2025.
- Critical for the southern regions’ yield realisation, particularly for wheat and barley.
- Soil moisture maps show improvement, but Western Australia remains dry.
🧭 Conclusion
Australia’s grain sector remains resilient and export-driven, with strong potential in wheat and sorghum. However, water availability and input competition are shifting rice and crop strategies long term. China continues to play a decisive role in shaping grain flows.
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