Canola fields light up Australian harvest

Golden fields of canola across Australian paddocks have brightened recovery prospects for many farmers battered by years of drought.

The government forecaster predicts winter crop production in Australia will increase by 64 per cent in 2020/21, which is 20 per cent above the 10-year average.

Rabobank grains and oilseeds senior analyst Cheryl Kalisch Gordon said national canola production was predicted to rise 50 per cent.

Good season-opening rains allowed earlier planting of canola, which generally has an earlier window than many crops.

"In most areas that's been followed up with sufficient rain throughout the growing season keeping it on track to really have a sensational year-on-year increase," Dr Kalisch Gordon told AAP.

"That's really going to be driven by a resurgence in supply from New South Wales which year-on-year is something close to 290 per cent."

Export markets are shaping up well, with Europe having a second below-average harvest in a row.

"That's in part due to COVID, meaning they're using less canola in the production of biodiesel," Dr Kalisch Gordon said.

"But still they're looking at close to record levels of imports."

Europe typically imports canola from Ukraine, which is on track to produce around one million fewer tonnes this year due to dry weather.

"It really puts Australia in the box seat for supply into Europe," Dr Kalisch Gordon said.

Canada - the world's biggest canola producer - grows up to 95 per cent genetically modified crops, with the EU preferring non-GM varieties.

The majority of Australian canola is not genetically modified.

Dr Kalisch Gordon said wheat was also on track for a strong season with prices higher than the last time Australia had excess supply in 2016/17.

Barley, the other major winter crop for many Australian farmers, is under pressure amid a trade dispute with China.

"Barley is going to be a challenging outlook, but I think for wheat we're going to have some good pricing that is going to support the start of the recovery for lots of farmers on the east coast," Dr Kalisch Gordon said.

"When they get some cash in December that will be the first time in three years.

"It's just the start of what's required but it looks at this stage to be a fairly good start on that road to recovery."