A seed shortage, besides a lack of rain, has undermined prospects for Australia's canola crop, the Australian Oilseeds Federation said, as it lowered the bar on expectations for the harvest in the key exporting country.
The industry group pegged at 3.12m tonnes Australia's 2017-18 canola harvest – a drop of 26% year on year on its data.
The estimate was also below forecasts from other commentators, with Abares, the official Australian crop bureau, putting the harvest at 3.32m tonnes, and the US Department of Agriculture, which will on Wednesday update its world crop supply estimates, pegging it at 3.70m tonnes.
The International Grains Council two weeks ago cut its forecast by 400,000 tonnes to 3.3m tonnes, seeing "yields seen retreating sharply from the previous year's unprecedented levels" output thanks to dry weather, notably in Western Australia, the top canola-producing state.
Australia is the world's second-ranked exporter of canola/rapeseed, behind Canada, with market share of some 20%.
Even with a 3.3m-tonne estimate for the Australian harvest, the International Grains Council sees a small world canola production deficit in 2017-18, forecasting a 200,000-tonne drop to a multi-year low of 3.8m tonnes in global inventories over the season.
The Australian Oilseeds Federation underlined the setback to canola prospects from dry weather, despite some boost to grower sentiment from "recent rains… after one of the driest June months on record in many canola growing regions".
"We are reluctant to lift forecast yields at this time, as the rain that has fallen has been patchy and light, being generally less that 15mm in most areas."
Looking ahead, "no significant rain events are forecast for the next few weeks", and already the dryness has cut area prospects.
"Reported area sown in Western Australia, and South Australia has been reduced from earlier estimates as dry-sown canola in some areas failed to germinate and has been resown to cereals or left fallow."
And as a further setback to harvest prospects, there is a question mark over the quality of the seed used too, with the federation reporting "commercial planting seed shortages"
While this has not prevented farmers sowing 2.3m "viable" hectares of canola, a figure in line with the five-year average, growers had relied to an unusually large extent on seed held over from the previous harvest.
"The higher-than-average use of farmer saved seed, at the expense of hybrids, has caused us to temper yield estimates from the start, before accounting for any moisture related stress that may eventuate," the federation said.
"Weighted average yield is currently 1.33 tonnes per hectare versus the five-year average, excluding last year, of 1.53 tonnes per hectare."
The federation added that its production figure included a forecast for the Western Australian yield of "slightly under 1.2 tonnes per hectare, well short of recent yields and more in line with those experienced last decade", reflecting dry conditions.
The Western Australia harvest was seen suffering a particularly steep decline, of 41% to just under 1.30m tonnes.
By contrast, in Victoria, which had enjoyed "very positive growing conditions", an above-average yield forecast was being used.
"Soil moisture levels remain good in many areas, including the Wimmera and Mallee, but will be in need of replenishment soon."
By Mike Verdin