AUSTRALIAN cotton exports will increase by 89 per cent this financial year to a record 955,000 tonnes.
It will set the nation on track to become one of the largest cotton exporters in the world.
The surge is being driven by strong offshore demand and supported by a bumper year for the sector, which is due to produce a record 1.1 million tonnes of the fibre in 2011-12.
The numbers were included in an Australian Bureau of Agricultural and Resource Economics and Sciences report released today that highlights positive outlooks for the agricultural, fisheries and forestry sectors.
Assuming favourable seasonal conditions continue, Australia's earnings from domestic farm exports are forecast to be around $35.1 billion in 2012-13, after an estimated rise of 9.4 per cent to $35.5 billion in 2011-12.
The Agricultural Commodities Report also predicts cotton exports will increase by a further 12.5 per cent in 2012-13, to another record of 1.1 million tonnes.
If that occurs, Australia will surpass Uzbekistan to become the third-largest cotton exporter in the world, behind the United States and India.
While an estimated 48 per cent of cotton was planted in flood-affected areas during late 2011 and early 2012, damage was minimal because the effects of flooding tended to be localised.
But after reaching a record high in 2012-13, cotton exports are expected to decline to around 749,000 tonnes by 2016-17 - albeit still above the average of 552,000 tonnes produced in the 15 years to 2010-11.
Meanwhile, export earnings for canola are expected to rise by a modest two per cent in 2011-12, while raw cotton export earnings are expected to increase by nine per cent.
Wine exports are tipped to go up by five per cent, beef and veal by one per cent, and sheep meat by 22 per cent.
As well, wheat production is expected to fall by 13 per cent to around 26 million tonnes in 2012-13, the result of less being planted because of less demand.
Australian sugar production is forecast to recover to 4.25 million tonnes in 2012/13, after damage from tropical cyclone Yasi resulted in an estimated 3.73 million tonnes in 2011-12.
Returns to Australian sugarcane growers are projected to decline to $30 a tonne in 2016-17, compared with a forecasted $41 a tonne in 2011-12.
ABARES attributed the decrease to dropping world sugar prices.
The report was presented to the ABARES Outlook 2012 conference in Canberra.