It has been a relatively quiet week on the markets. Possibly a mere coincidence that there has been less antagonistic language coming from the White House around trade tariffs. The messages coming out of the US sound almost buoyant, with trade deals being signed and world leaders apparently queueing up to seek a common path forward.
Wheat markets turned a little sour this week as a lack of weather-related problems allowed the price to drift south. Good rains have been recorded across the US Plains, where the HRW wheat crop had been getting dry. Crop conditions have responded by lifting 4% points on the week to now being 49% good to excellent and on par with last year. Good Spring rains have also allowed for rapid row crop planting, with soybeans at a record 18% complete and corn right on average at 24% complete.
The weather market is starting to throw up a few flags, with a few areas recording less rainfall than they’d like. Notably, key Chinese winter wheat areas are drying out after a very good start. Last year, they produced a record 140 mmt crop which resulted in a significant decline in imports. This year, earlier forecasts suggested a crop as good, if not better, than last year. A dry spell is not necessarily the death knell for the crop, but it will require monitoring.
Information about the state of Ukraine’s crop is being overshadowed by the ongoing dispute and current attempts to secure a ceasefire. Wheat production is forecast at a modest 17 mmt and canola 3.9 mmt, down 5% from last year. This compares to 33mt for wheat and 3.1mmt of canola grown in 2021. The rise in canola production can be attributed to the Ukrainian farmer trying to grow a crop with higher gross margins on reduced acres.
While on canola, the oilseed is a case of mixed fortunes. A late-season fight for acres has allowed Canadian (GM) canola to claw back everything that was lost on earlier tariff and trade obstructions. Fears that the Canadian farmer would plant less canola have prompted Winnipeg ICE to surge, along with positive discussions around biofuel mandates and a softer tone coming from Beijing. However, for growers of non-GM canola, European futures appear to have hit a ceiling. A weak economic outlook, falling crude prices, and conflicting and confusing trade barriers are pushing the price of EU canola lower.
The week ahead….
Weather will be the key driver of prices for the next couple of weeks. Be careful about getting caught up in the news of ‘potential’ problems, as a timely rain can quickly dash hopes of a rally.
2026 has opened with a familiar driver dominating the headlines: geopolitics. Forget Russia, Venezuela or Greenland, developments in Iran arguably carry far greater implications for
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.
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.
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.
Weather drives the news cycle
Wheat markets turned a little sour this week as a lack of weather-related problems allowed the price to drift south. Good rains have been recorded across the US Plains, where the HRW wheat crop had been getting dry. Crop conditions have responded by lifting 4% points on the week to now being 49% good to excellent and on par with last year. Good Spring rains have also allowed for rapid row crop planting, with soybeans at a record 18% complete and corn right on average at 24% complete.
The weather market is starting to throw up a few flags, with a few areas recording less rainfall than they’d like. Notably, key Chinese winter wheat areas are drying out after a very good start. Last year, they produced a record 140 mmt crop which resulted in a significant decline in imports. This year, earlier forecasts suggested a crop as good, if not better, than last year. A dry spell is not necessarily the death knell for the crop, but it will require monitoring.
Information about the state of Ukraine’s crop is being overshadowed by the ongoing dispute and current attempts to secure a ceasefire. Wheat production is forecast at a modest 17 mmt and canola 3.9 mmt, down 5% from last year. This compares to 33mt for wheat and 3.1mmt of canola grown in 2021. The rise in canola production can be attributed to the Ukrainian farmer trying to grow a crop with higher gross margins on reduced acres.
While on canola, the oilseed is a case of mixed fortunes. A late-season fight for acres has allowed Canadian (GM) canola to claw back everything that was lost on earlier tariff and trade obstructions. Fears that the Canadian farmer would plant less canola have prompted Winnipeg ICE to surge, along with positive discussions around biofuel mandates and a softer tone coming from Beijing. However, for growers of non-GM canola, European futures appear to have hit a ceiling. A weak economic outlook, falling crude prices, and conflicting and confusing trade barriers are pushing the price of EU canola lower.
The week ahead….
Weather will be the key driver of prices for the next couple of weeks. Be careful about getting caught up in the news of ‘potential’ problems, as a timely rain can quickly dash hopes of a rally.
Have any questions or comments?
Click on graph to expand
Click on graph to expand
Click on graph to expand
Click on graph to expand
Data sources: USDA, Reuters, Argus, Next Level Grain Marketing, Mecardo
Categories
Have any questions or comments?
Interesting Times
“May you live in interesting times” is a phrase often attributed to a 19th-century House of Commons speech. While it reads like a vague blessing,
Stock feeding proving cheaper
You would think that with disasters at the top and the bottom of the east coast wiping out feed, and again instigating hay drives, the
New Year, old themes
2026 has opened with a familiar driver dominating the headlines: geopolitics. Forget Russia, Venezuela or Greenland, developments in Iran arguably carry far greater implications for
Little joy in terms of price for sellers
The Ashes are over, the Poms are heading home, the traders are back at their desks, and the headers are pulling up. The first grain
Want market insights delivered straight to your inbox?
Sign up to the mailing list to get regular updates to new analysis and market outlooks
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.
SERVICES AND CAPABILITIES STATEMENT BROCHURE
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.