Another week gone, another week dictated by happenings in the US. This week, the USDA published its September US stocks report. Both corn and wheat stocks were raised above pre-report estimates, which saw prices tumble. The increase is attributed to higher yields, especially in the winter wheat classes. Corn carryout is now tipped to be the largest it has been in the past 10 years.
Adding complexity to the market is the somewhat controversial US government shutdown. With Congress failing to pass a budget, most federal agencies (~750k employees) have been shuttered, including the USDA. While essential services remain, they are operating without pay. For the grain markets, the immediate consequence is the suspension of key USDA reports, including export sales and the Commitment of Traders (COT) data.
Why does that matter? Without COT data, speculators can shift or exit positions without the market seeing it in real time. The last time a government shutdown occurred in 2018, the eventual release of the data revealed major position changes that caught traders off guard. Given the 5c/bu rise in Dec ’25 wheat last night, there are already signs that short positions may be getting unwound. If the shutdown drags on, the October WASDE is also unlikely to be published, leaving the trade without a clear global supply and demand snapshot. That absence of transparency could either fuel volatility or lead to paralysis as participants wait for better visibility.
Looking outside the US, Black Sea risks remain elevated. The US has given approval for Ukraine to strike Russian assets deeper into Russian territory, threatening to escalate the dispute. Russian FOB prices have increased for the week as demand at port is outweighing the supply coming from further inland.
From a production perspective, most of the Northern Hemisphere crop is now in the bin. Southern Hemisphere crop conditions look good, with Australia tipped to produce somewhere between 35–37mmt and Argentina’s crop increased from 20.5mmt to 22mmt. The outlook for large global crops, and by association, large carryout, will act as an anchor on prices for some time to come.
Next week
In summary, heavier US stocks, a government shutdown clouding market visibility, and strong Southern Hemisphere crops all point to a market still anchored by supply. Until fresh demand emerges or a geopolitical shock shifts the outlook, wheat is likely to remain rangebound with a bearish tilt.
This weeks commentary is more about macro-economics and geopolitics that anything directly wheat oriented. Having climbed to over 0.70USc, the AUD has tipped over in
The final harvest reports are in, with further updates likely to offer minimal changes. Western Australia has received the promised bumper crop, while receivals on
The global canola trade had another significant shift last week with China reducing tariffs on Canadian canola. The response in the Canadian markets was strongly
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Stocks, shutdowns, and surprises
Adding complexity to the market is the somewhat controversial US government shutdown. With Congress failing to pass a budget, most federal agencies (~750k employees) have been shuttered, including the USDA. While essential services remain, they are operating without pay. For the grain markets, the immediate consequence is the suspension of key USDA reports, including export sales and the Commitment of Traders (COT) data.
Why does that matter? Without COT data, speculators can shift or exit positions without the market seeing it in real time. The last time a government shutdown occurred in 2018, the eventual release of the data revealed major position changes that caught traders off guard. Given the 5c/bu rise in Dec ’25 wheat last night, there are already signs that short positions may be getting unwound. If the shutdown drags on, the October WASDE is also unlikely to be published, leaving the trade without a clear global supply and demand snapshot. That absence of transparency could either fuel volatility or lead to paralysis as participants wait for better visibility.
Looking outside the US, Black Sea risks remain elevated. The US has given approval for Ukraine to strike Russian assets deeper into Russian territory, threatening to escalate the dispute. Russian FOB prices have increased for the week as demand at port is outweighing the supply coming from further inland.
From a production perspective, most of the Northern Hemisphere crop is now in the bin. Southern Hemisphere crop conditions look good, with Australia tipped to produce somewhere between 35–37mmt and Argentina’s crop increased from 20.5mmt to 22mmt. The outlook for large global crops, and by association, large carryout, will act as an anchor on prices for some time to come.
Next week
In summary, heavier US stocks, a government shutdown clouding market visibility, and strong Southern Hemisphere crops all point to a market still anchored by supply. Until fresh demand emerges or a geopolitical shock shifts the outlook, wheat is likely to remain rangebound with a bearish tilt.
Have any questions or comments?
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Data sources: Reuters, USDA, StoneX, Zaner Ag Hedge, Next Level Grain Marketing, Mecardo
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Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published
Listen to the podcast
Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.
MEET THE TEAM
Our team of market analysts are recognised as leaders in Australian Ag market analysis, providing invaluable insights to help you navigate the ever-changing commodity landscape.
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We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.