AUSTRALIAN farmers are heading towards a record-high winter crop planting this year, Rabobank says in its newly-released 2025-26 Australian Winter Crop Outlook.

The annual outlook, by the agribusiness banking specialist’s RaboResearch division, says the nation’s grain growers are expected to plant an estimated 24.5 million hectares of winter crops this year, up 0.8 per cent on last season.

The forecast increase is largely driven by good soil moisture levels in northern New South Wales and Queensland, as well as a “positive gross margin outlook” for most crop types.

Area planted to crops is expected to be up in all states, except for South Australia – where many regions have been struggling with severe drought conditions.

Victoria – which has also been impacted by drought in many western parts of the state – is expected to see cropping area edge up only fractionally.

The overall rise in national planted area is expected to benefit most crops, except for wheat, where area is forecast to drop – especially in Western Australia – impacted by rising fertiliser prices and less optimistic market prospects.

Despite the projected overall increase in Australia’s winter cropping area, RaboResearch is currently forecasting total production for the 2025-26 harvest to come in below last year, at a “base case” of 53.9 million tonnes, compared with 59.7 million tonnes for last year’s crop.

Report author, RaboResearch senior analyst Vitor Pistoia said Australia’s 2025-26 winter cropping area may be “the largest on record” if a “seasonal break comes soon in South Australia and western Victoria”.

However, the impact of weather on the season ahead has led the bank to expect there would be a slightly reduced amount of grain heading to the bins at harvest time.

“Summer rainfall in Queensland and northern New South Wales was above average, leading to flooding in some cropping regions and this may delay sowing, but is supportive for another season of large sowing areas,” Mr Pistoia said.

“WA’s southern cropping areas also received timely rainfall to have a good start to the season.

“Other cropping regions around the country though, did not get the same summer luck.  Soil-moisture levels are generally insufficient, especially in South Australia, western parts of Victoria and southern New South Wales.”

“As of mid-May, the weather outlook for the season ahead is for average rainfall for the eastern states and some chance of above average rainfall for Western Australia by spring time,” he said.

Area planted to wheat is expected to decrease 5.2 per cent on the previous year, to 12.6 million hectares, the report says.

The most significant drop in wheat planting is anticipated in Western Australia, Mr Pistoia said.

“Overall, this decline in wheat planting is attributed to rising fertiliser prices and less enthusiasm about the outlook for wheat prices,” he said. “Crop rotation is also a factor, as last year’s late seasonal break led to wheat replacing canola and pulses at the eleventh hour and those farmers will now be looking to plant a different crop,” he said.

RaboResearch expects cropping area for barley to increase 9.8 per cent year-on-year to 4.5 million hectares, supported by strong demand for livestock feed from the local animal protein sector.

“Despite gross margins for barley expected to be within historical averages, it is a promising outlook for regions that can achieve higher yields with barley than wheat, as the price difference between the two commodities is comparatively small,” Mr Pistoia said.

Canola planting is projected to remain “virtually stable” – with just minimal forecast area growth of 0.4 per cent on last year to 3.2 million hectares, seeing increases in Western Australia and declines in the eastern states.

“There is a supportive outlook for canola, although the price direction varies between genetically-modified (GM) and non-GM canola,” Mr Pistoia said.

“Geopolitical turmoil is pressuring the GM-canola market, while demand from the EU is driving non-GM fundamentals.”

Pulse plantings are also expected to be up considerably – by 12.5 per cent on last season – to 3.4 million hectares, with Western Australia and Queensland likely to lead the expansion in pulse area.

This is driven by tariff announcements in key pulse markets – including India, a country crucial to Australian pulse exports – that indicate demand will remain steady.

“Such positive overseas’ demand signals may lead to higher margin potential compared with cereals,” Mr Pistoia said.

In terms of market outlook, the report says, “despite the US’s tariff-driven efforts to re-order global trade, Australia’s key grain and oilseeds exports seem largely unscathed for now and may gain global market share”.

“Asian countries rely on Australia to source imports of grains and pulses, and the EU imports canola to balance its supply of oilseeds,” Mr Pistoia said.