By Colin Packham
SYDNEY, July 28 (Reuters) - Australia's east coast is forecast to receive above average rainall over the next three months, the country's weather bureau said on Thursday, boosting wheat and cattle production.
The entire east coast has at least a 60 percent chance of above average rainfall in August to October, the Australian Bureau of Meteorology said, with an 80 percent chance of above average rains for northeast coast.
The forecast will increase expectations that 2016/17 output of wheat - the country's most significant rural export - will exceed official estimates, pegged last month at 25.4 million tonnes - a five year high. a favourable weather outlook for the east coast following near-perfect conditions so far, analysts are confident production will go even higher, improving the prospect for exports from the world's fourth largest exporter.
"There is upside to production, even in excess of our most recent forecast of between 26-27 million tonnes," said Phin Ziebell, agribusiness economist, National Australia Bank. "The way Australia is going, we are on track to do extremely well."
Increased prouduction from Australia will add pressure to global wheat prices, Wv1 , which earlier this month hit a near 10-year low.
In contrast to wheat, the weather outlook could push sales of beef from the world's third-largest exporter below official forecasts by helping farmers rebuild their beef herds, analysts said.
Australia's beef exports are already set to fall to a three-year low in 2016/17 season as farmers have fewer cattle to sell after a prolonged drought pushed the size of the national herd to more than a two-decade low.
Heavy rains will aid pasture growth, refill damns and boost production of feed crops.
Herd rebuilding is already having an impact on local prices. Australia's beef benchmark, the Eastern Young Cattle Indicator, on Wednesday hit an all-time high of A$6.71 ($5.04)per kilogram as farmer demand for restocking offsets slowing export demand.
($1 = 1.3310 Australian dollars)