Weather: Late-season dryness across the US Midwest is reinforcing yield concerns for corn and soybeans, with August among the driest on record in Illinois, Missouri, and Ohio, though parts of the Western Corn Belt were wetter. Europe remains mixed, with France’s wheat rebounding but maize yields cut by hot, dry spells..
Markets: Grain markets firmed overnight with wheat leading gains on short-covering, a weaker USD, and strong export demand, while corn and soybeans followed on lower yield ideas and optimism around US–China trade talks. Canola also tracked higher alongside the soy complex and crude oil.
Australian Day Ahead: Offshore strength in ag markets was led by wheat, but locally the impact may be muted by a firmer AUD and more engaged grower selling. Canola could open a little firmer, particularly GM, while cereals are likely to remain steady.
Offshore
Wheat
US wheat futures extended gains: WZ +9c, KWZ +9.5c, MWZ +4.75c; Paris Matif +€0.25, Russian cash flat at ~$227. Chicago Dec wheat finished 1.6% higher at $5.34/bu.
Support from short-covering (~465k US/EU combined), lower USD, and macro inflation momentum; WZ posted 4 straight higher closes.
France raised its wheat crop to 33.3 million tonnes (Mt) (+30% y/y), while EU exports lag LY at 3.78Mt vs. 5.73Mt. French growers reluctant to sell sub-€190/t.
Asian millers booked ~850kt US wheat (Indonesia, Bangladesh, Sri Lanka) amid Black Sea delays; additional demand seen from Asia.
Stronger US export demand tied to weaker dollar and Russia tripling its export tax; reports suggest more Asian countries eyeing US wheat.
Jordan cancelled a 120kt tender, highlighting patchy demand, but overall export demand remains resilient on competitive US pricing.
Other grains and oilseeds
Corn futures rallied (Dec +6.25c to 431.25, later +1.4pc to $4.29) on sub-180 yield chatter, disease/dryness pressure, and skepticism over USDA’s 186.7 bu/acre estimate.
USDA Crop Progress cut corn G/E to 67pc and soybeans to 63pc, reinforcing yield downgrade expectations; dryness in IL, MO, OH capped yields.
Soybeans supported (+7c SX, +0.6pc to $10.50/bu) on lower yield ideas, hot/dry finish, and optimism around Trump–Xi talks possibly leading to Chinese buying.
US soybean export concerns linger, with China absent from recent sales; USDA cut 2025/26 export forecast by 20m bu to 1.69b bu.
Canola rebounded on spillover from soy/rapeseed and crude oil strength; Nov canola regained its 20-day moving average despite stronger CAD.
Vietnam buying ~30kt/month Canadian canola meal after China imposed anti-dumping duties, diversifying trade flows in oilseed meals.
Macro
Markets positioning for Fed decision: DXY down 0.7pc, UST yields softer; optimism for rate cut (+25bp expected, cycle -125bp seen) underpinning commodities.
Broader commodity rally tied to inflation hedging and weaker USD; speculative money may shift into grains as feed costs bottom.
Global oil prices higher (WTI +1.7pc to $64.6/bbl) on Ukraine refinery attacks, Russia output down to 8.8mb/d, and Middle East tensions (Israel strike on Hodeida).
Gold surged above $3,700/oz, supported by weak USD and Fed cut expectations; base metals mixed with copper retreating, aluminium supported by tight LME stocks.
US retail sales rose 0.6pc m/m in Aug, defying tariffs; UK wage growth eased to +4.7pc y/y, consistent with gradual disinflation.
US–China geopolitics remain volatile: TikTok deal nearing finalisation, trade talks ongoing, but tensions over Russia oil purchases and proposed tariffs threaten supply chains.
Australia
Through the west of the country bids were slightly mixed with canola ~A$815 FIS Albany, wheat steady at $330 and barley $306.
In the east canola eased $4 to $782 track Port Kembla, wheat was $326 and barley $290.
Some handy totals through the SA/Vic Mallee and Wimmera with 5–15mm over the past 24 hours.
Barley markets continue to soften with Jan+ delivered Griffith offered $295, Western Districts $305 and Geelong $312.
Over the last week Qld grids lifted 10–30c/kg with heavy cows ~670c/kg and grass ox 750–760c/kg, while southern states held steady but remain reliant on northern cattle flows. Export demand into the new year is strong despite a firmer AUD, with saleyards trends also firmer led by stronger cow competition.
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