Australia wheat crop faces hot, dry weather for next three months

SYDNEY (Reuters) - Hot, dry weather will persist across Australia's east coast until at least October, the country's weather bureau said on Thursday, signalling no relief for drought-hit farmers in one of the world's largest agricultural producers.

There is just a 30% chance that Australia's east coast will receive average rainfalls between Aug. 1 and Oct. 30, the Bureau of Meteorology said in its latest climate outlook.

The forecast would extend drought conditions that have devastated agricultural production across Australia's east coast into a third year.

In a further blow, the bureau said there is at least an 80% chance that the entire country will record warmer than average temperatures over the next three months.


GRAPHIC: https://fingfx.thomsonreuters.com/gfx/editorcharts/AUSTRALIA-WHEAT/0H001QEEV70M/eikon.png


Australia's chief commodity forecaster in June lowered its forecast for wheat production over the 2019/20 season by more than 11%, but warned rains were desperately needed to avoid further downgrades.

Lower production may help support benchmark global wheat prices but it threatens to be a drag on the Australian economy.

Wheat is the country's most lucrative rural export from an agricultural sector worth about A$50 billion ($35 billion).

With Australia on course to have only a small exportable crop, traditional buyers of its wheat such as Indonesian and Japanese millers will be forced to look to alternative markets such as Russia at a time when prices are rallying.

($1 = 1.4355 Australian dollars)


(Reporting by Colin Packham; editing by Richard Pullin)