The latest official figures confirm Australia has benefited from a third consecutive year of significant rainfall, with producers soaking up exceptional growing conditions and high commodity prices.
Agricultural exports are also forecast to set new records, reaching $75 billion this year.
Canola and wheat production have driven most of the growth, while barley production is the third highest on record.
The figures have been released by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
"We've seen exceptional results coming out of Western Australia, South Australia and Victoria, this is occurring despite some of the widespread flooding," ABARES executive director Jared Greenville said at a conference in Canberra examining the figures.
"High values of livestock production have also contributed to these record numbers, with producers increasing their production while also benefiting from historically high prices."
Dr Greenville said this year would likely be the "last hurrah" for the La Nina rain system for a while, with drier conditions ahead.
"However, production will continue to be supported by good soil moisture and high water storage levels."
He also warned Australia must keep in step with international domestic climate policies to remain competitive.
"Both changes in our climate and changes in international domestic climate policies will be important in defining the sector's future long term competitiveness," he told the conference.
He also predicted commodity prices would ease with competition stepping up in global markets.
"High international prices have been driven by drought conditions in major exporters and disruptions from the war in Ukraine," Dr Greenville said.
"But seasonal conditions are expected to improve in major producing regions, which will see major exporters getting back on track."
With seasonal conditions forecast to return to normal and commodity prices tipped to fall, the value of Australian agriculture is still expected to remain strong in the medium term.
"Should we see a shift back towards a drier climate sequence and global economic uncertainty carry on for longer, greater pressure will be placed on sector growth," Dr Greenville said.
"But we've had three years to create a buffer and recover from the last drought, so many of our farmers will be well placed to ride out these domestic and international changes."
Agriculture minister Murray Watt told the conference that several challenges face the sector including a skills shortage, biosecurity threats and adapting to climate change.
"The best time to start preparing for drought is when we're not in drought," he said.
"Continuing to develop our environmental credentials is vital to the future of Australian agriculture ... to secure and grow changing international markets for our exports."
