AUSTRALIA has produced its most valuable canola crop on record.

With the Australian Oilseeds Federation now estimating this year’s canola harvest at 2.95 million tonnes, the crop is valued at more than $1.4 billion.

In its latest monthly crop report, the AOF lifted its forecast for canola production by 12.2 per cent to set the new production record.

It exceeds the previous record crop of 2.4 million tonnes set in 1999-2000 by more than half a million tonnes.

With the canola harvest virtually complete, the AOF’s Nick Goddard said more confidence could be given to yield estimates.

“We have seen a significant and unexpected lift in yields across the country, which has led us to revise our estimates upwards by around 300,000 tonnes,” Mr Goddard said.

“Not only has Australia experienced a bumper crop in all respects this season, but prices have remained firm, delivering a double bonus to growers.”

The AOF increased its estimate of the Victorian crop by 40,000 tonnes to 630,000 tonnes – its largest production by far.

The federation lifted its yield forecast from 1.59 tonnes/ha last month to 1.74 tonnes/ha in its December report.

The NSW crop has risen by 90,000 tonnes to 720,000 tonnes, while South Australia production has been increased by 31,000 tonnes to 396,000 tonnes.

The AOF said although floods had reduced its estimate of the crop area in NSW by 5000ha, an increase in the yield from 1.59 tonnes/ha to 1.85 tonnes/ha had more than compensated.

The updated crop forecast for NSW set a new production record for the state.

The largest increase has been in Western Australia, where the average yield has been increased to 1.5 tonnes/ha, boosting production by 160,000 tonnes to 1.2 million tonnes.

The AOF said already 1.1 million tonnes of canola had been delivered into CBH Grain’s bulk handling system.

If the 1.2 million tonne crop was realised, it would be the state’s largest on record, the federation said.

Mr Goddard said cooler conditions experienced across Australia following flowering, together with a good moisture profile, set up ideal conditions for oil development in the seed in the lead-up to harvest.

“The near ideal conditions have also seen very good oil levels being recorded, with 44 per cent being reported as a fair average across the country (versus a traditional average of 42 per cent),” he said.

“In a number of cases in both east and west of the country, oil levels of 49% and even higher have been reported.”

Mr Goddard said unrelenting demand for biodiesel, particularly from the European Union, coupled with demand for oil and meal from China and weather concerns over the South American soyabean crop had kept canola prices firm during the year.

“This is despite a general softening in commodity prices on the back of concerns stemming from the financial turmoil in Europe,” he said.