Australia's total winter crop production for the 2025 to 2026 season is now forecast at 62.3 million tonnes, the third largest crop on record and a 12% increase from the mid-year forecast of 54.5 million tonnes, Bendigo Bank said in its 2026 Australian Agriculture Outlook report on Tuesday.
The increase in the forecast was driven by a turnaround in Western Australia, where the production forecast has jumped 26%, or around 5 million tonnes, since June.
Around two-thirds of Australia's agricultural products are exported. The six months ahead for Australian agriculture will be impacted by seasonal conditions and the economic environment, per the report.
While seasonal risk and economic uncertainty remain at the forefront, the outlook for Australian agriculture is broadly positive going into 2026, said Eliza Redfern, the bank's agribusiness senior manager of industry insights.
Beef production is tipped to drop slightly from the high volumes in 2025. Strong demand especially from an export perspective is likely to keep prices firm, supported by reduced supply in the US. Australian lamb and mutton supply is estimated to remain lower in the first half of 2026, with prices easing from recent record highs but remaining well above the five-year average. Constrained supplies are expected to support rising wool prices.
Milk production is set to drop 1% to 2% to around 8.2 billion liters, while continued global milk supply growth is expected across other major dairy export competitors. The lender expects average southern farmgate milk price of AU$9.40 kilograms of milk solids and AU$9.78 kilograms of milk solids nationally for the 2025 to 2026 season.
Output is forecast to remain high across the fruit and nut sectors while vegetable production will be pressured by high irrigation costs, the bank said.
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