Australia's wheat output is set to rise next season despite a marginal drop in plantings, as the country continues the trend of rising productivity following its recovery from drought.

The impact of a drop of 41,000 hectares in Australian wheat sowings will be more than offset by a rise to 1.60 tonnes a hectare in yields, forecasters at the country's official commodities bureau, Abare, said.

The increase will swell the 2010-11 crop by 284,000 tonnes to 21.94m tonnes.

The estimate follows considerable speculation of a fall in Australia's harvest this year, as weak prices prompt farmers to cut back more significantly on sowings.

And a City analyst told Agrimoney.com that forecasts were "speculative" at this stage and would depend largely on the timing of rains.

Sheep vs wheat 

Nonetheless, Abare, in an annual crop forecast report, forecast Australian growers maintaining their love of wheat despite the improved attractions of sheep, which have enjoyed a revival in prices.

Nonetheless, Australian sheep numbers would remain at some 70m head over the next five years, compared with 110m head in the early 2000s.

Wheat sowings, meanwhile, would expand by some 166,000 hectares, helping production approach 25m tonnes.

Exports will hit 17.4m tonnes in 2014-15, up by one quarter on those in the current season.