Australia, projected to receive higher rainfall from may to July, which will improve the yield and increase the incomes of farmers in one of the world's major exporters of raw materials.

As the strongest over the past 20 years El Nino is weakening, there was 70% probability that most of Australia will receive above average precipitation level for the next three months, according to the Bureau of meteorology (BOM) of the country. Climate model El niño typically brings dry weather in a region.

The increase in production could put pressure on global prices for the grain, such as wheat and corn, which are already under pressure from excess global supply.

More wet weather especially will please producers of wheat, which were sown late harvest.

Higher rainfall will increase the prospects of the national production, which heavily depends on Western Australia is the largest producer and exporter, said agricultural economists at National Australia Bank.

Australia, projected to produce 24.5 million tons of wheat during the season 2016/17, the highest level in three years.

But analysts noted that most of the rain predicted by the BOM, will come in June, two months after the start of the season, suggesting the probability of their weakened influence on the Eastern regions of Australia that have suffered from drought conditions.

Analysts said that production in areas such as Victoria, the fourth largest region of wheat production in the country may not match official forecasts.

Wet weather is also favourable for pasture and replenishment of water reservoirs that will help pastoralists in the third world export of beef to restore the herd.

Australia, forecast to show a fall in the export of beef to a three-year low after a drought in key producing regions has forced farmers to send animals to slaughter at a record pace, which resulted in the decrease of the size of the national herd to 20-year low.

Source: Thomson Reuters