AUSTRALIAN oilseed growers have produced the second-biggest canola crop on record.

In its January crop report, the Australian Oilseeds Federation estimated the current national canola crop at 1.91 million tonnes, about 500,000 tonnes short of the record 1999-2000 crop.

"With the majority of the harvest now complete, more accurate estimates of canola tonnages received are now available," the AOF said.

The AOF's latest estimate of the 2009-10 canola crop is a 140,000-tonne rise from last month.

Most of that is attributed to a finetuning of the West Australian crop estimate, which has risen from 850,000 tonnes last month to 975,000 tonnes this month.

The Victorian canola crop estimate increased from 390,000 tonnes last month to 402,000 tonnes this month.

It is much higher than the 310,000 tonnes forecast at sowing time.

The Victorian crop is the largest in six years and the third-largest on record.

Victoria accounts for 21 per cent of national production.

The state's crop could have been higher if a heatwave in late spring had not hit crops hard, particularly in the prime canola- growing region, the Western District.

Oil contents were also lower than normal.

The AOF left the South Australian crop unchanged at 290,000 tonnes, while the NSW crop estimate rose by a meagre 3000 tonnes, to 243,000 tonnes.

Despite the relatively small NSW crop, the AOF said the season bode well for the future of the canola industry.

"This (a 1.9 million tonne crop) is an excellent outcome for the 2009-10 season, and while disappointing for much of NSW, strong yields and good returns in other states are expected to bolster canola planting intentions for the coming season, tempered as always by weather and price expectations," it said.

The previous biggest national canola crop, in 1999-2000, was 2.4 million tonnes.

Subsequent national crops occasionally topped 1.6 million tonnes but fell as low as 512,000 tonnes three years ago as a string of droughts ravaged production.

Smaller crops during the past decade were also a function of growers switching to less risky options as the threat of drought sapped their confidence in canola.