Wheat production in Australia will probably drop from the third-biggest on record on lower yield, while shipments may increase on higher reserves.

The harvest in the world’s fourth-biggest supplier may total 24.8 million metric tons from 27 million tons in 2013-2014 as yields decline, the Australian Bureau of Agricultural and Resource Economics and Sciences said in a report, giving the first estimates for the crop to be planted from next month. Exports may total 19.1 million tons in the year starting July 1 from 18.5 million tons a year earlier.

Futures in Chicago climbed 8.4 percent in February, the most since July 2012, on concern freezing conditions damaged crops in the U.S., the biggest exporter, curbing global supply. The International Grains Council predicts lower global output in 2014-2015, while Commerzbank AG says crops may be at risk from the possible development this year of an El Nino weather pattern that can parch Australia and bring rains to South America.

“A small increase in the area planted to wheat is expected to partially offset a fall in the average yield from the above-average yield achieved in 2013–14,” the Canberra-based bureau said. Increasing exports “largely reflects a drawdown in stocks carried over from 2013–14,” it said.

Australian farmers may plant 13.6 million hectares (33.6 million acres), up 1 percent from a year earlier, the bureau said. Yields may decline 9 percent in 2014-2015 from a year earlier, Abares said. About 70 percent of Queensland is in drought, according to the state government.

New South Wales, the country’s second-biggest wheat producer last season, had the driest January since 2003, according to the Bureau of Meteorology. Australian Prime Minister Tony Abbott said Feb. 26 that farmers will get A$320 million ($286 million) in drought assistance.

Conditions in eastern Australia may deteriorate further. International climate models show Pacific Ocean temperatures approaching or exceeding El Nino thresholds in the austral winter, the Bureau of Meteorology said Feb. 25. Australia’s winter runs from June to August.