WA faces the nation's biggest fall in the grain harvest this year with the wheat crop set to be about 40 per cent less because of dry weather.
Commodities forecaster ABARES said yesterday Australia's wheat, barley and canola production would fall 20 per cent to 36.2 million tonnes in 2012-13.
WA is likely to bear the brunt of the decrease in wheat production because of record low rainfall in July.
WA winter crop production is set to fall 35 per cent to 10.9 million tonnes in 2012-13, while the wheat harvest is tipped to fall 39 per cent to 7.1 million tonnes.
ABARES manager of agricultural commodities Peter Collins said WA's dry season meant it would fare worse than the rest of the nation.
"There was a dry opening and rainfall since has been mostly below average," he said. "It's only been in the south of the cropping zone, near Esperance, that there has been anything like normal rainfall."
Mr Collins said WA typically made up a significant part of the nation's wheat crop.
"When it comes to wheat, WA is a very big player," he said. "When everyone has a reasonable year, WA can make up to one third of the national production of wheat.
"However, offsetting the loss of production, world wheat prices have gone up."
Grain handler CBH is holding to its winter prediction of 9.5 million tonnes but this could be revised depending on weather forecasts.
CBH general manager of operations Colin Tutt said 15mm weekly rainfall was needed from now until October for an average crop.
Areas hardest hit were north of the standard gauge rail lines, east of Merredin and around Salmon Gums.
WAFarmers grains section president Kim Simpson, who farms near Ballidu about 200km north-east of Perth, said dry conditions meant farmers could not realise record high wheat prices of more than $300/tonne.
Mr Simpson said last week's rain was welcome but was not enough.
"It held things for a week or two, but beyond that it dries out again and you're back in the same boat," he said."It got the crops advanced and at least they're still alive."
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