- Bearish wheat sentiment: Australia is projected to harvest 37 million tonnes of wheat in 2025-26, boosting export availability and intensifying price competition in Asia.
- Record barley output: Barley production is expected to reach a record 15.5 million tonnes, significantly above the 10-year average, adding further global feed grain supply.
- Export surge: Wheat exports are forecast at 27 million tonnes, 3.3 million tonnes higher year-on-year, targeting more than 50 countries.
- China’s shifting role: China now absorbs around 75% of Australian barley exports but only 4.5% of Australian wheat, reshaping regional grain trade flows.
- Pressure on Black Sea origins: Australia’s logistics advantage into Asia and aggressive export program are expected to weigh on Black Sea wheat prices.
Australia’s Grain Production Outlook
The USDA Foreign Agricultural Service projects Australia will harvest its second-largest wheat crop on record at 37 million tonnes in the 2025-26 season, a 34% increase above the 10-year average. Earlier rainfall deficits in Western Australia, which accounts for roughly 40% of national grain output, were offset by significantly above-normal precipitation from July onwards, improving crop conditions and driving exceptional yields.
Barley production is expected to reach a record 15.5 million tonnes, about 32% above the 10-year average, with the second-highest yield on record. This reinforces Australia’s position as a key global supplier of both food and feed grains.
Export Flows and Market Shifts
Australian wheat exports are forecast at 27 million tonnes in 2025-26, up 3.3 million tonnes from the prior season. Shipments will be spread across more than 50 countries, with core demand from Indonesia, the Philippines, Thailand, Vietnam, and South Korea. China’s share of Australian wheat purchases has declined to about 4.5% in the 2024/25 season, signaling a recalibration of its sourcing mix.
In contrast, China has become the dominant buyer of Australian barley following the normalization of trade relations, now accounting for roughly 75% of total Australian barley exports. This has displaced traditional customers such as Saudi Arabia, Japan, and Vietnam, tightening alternative supply options for these importers and reshaping regional feed grain trade patterns.
| Metric | 2025-26 / Latest Forecast | Vs. 10-Year Average / Prior Season |
|---|---|---|
| Wheat Production | 37.0 million tonnes | +34% vs 10-year average |
| Wheat Exports | 27.0 million tonnes | +3.3 million tonnes YoY |
| Barley Production | 15.5 million tonnes (record) | +32% vs 10-year average |
| Barley Exports | 8.6 million tonnes | Near record levels |
| China Share of Australian Wheat | 4.5% (2024/25) | Lower vs prior years |
| China Share of Australian Barley | ~75% of exports | Dominant buyer after trade normalization |
Market Impact: Pressure on Black Sea Wheat
Australia’s larger crop and aggressive export program are expected to be broadly bearish for global wheat prices, particularly for Black Sea exporters targeting Asia. The 27 million tonne Australian wheat export forecast, combined with competitive freight economics into Southeast Asia, will intensify competition in key destinations such as Indonesia, the Philippines, Thailand, and Vietnam.
While China’s reduced share in Australian wheat (4.5%) could open modest space for Black Sea supply, its dominant position in Australian barley imports (around 75%) highlights a strong preference for Australian feed grains. Overall, abundant Australian supply and favorable logistics are likely to force Black Sea origins to maintain sharp pricing to defend market share, contributing to a softer global price tone for both milling and feed wheat.
Source: Market Data
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