Weather: The focus remains on Brisbane, particularly now we look like getting more than a 2 day test. Elsewhere, nothing exciting to be honest.

Markets:  Actual results vs market expectations. StatsCan was a wet blanket, no doubt, most of the numbers came in above pre-report expectations. The market was looking for 37.99 million tonnes (Mt) of all wheat stocks, we got 39.95Mt. Canola was expected to be 21.3Mt, we got 21.8Mt. Durum 7.23Mt vs 7.135 although this one feels heavier given the 600kt jump.     

Australian Day Ahead:   More stocks globally on wheat and canola and the AUD still above 0.6600 means we will probably be on the back foot today. Downs barley has finally drifted lower although it feels like the offer side isn’t overly keen to chase it lower. Feels defensive across the board today.

Wheat

Market moves: Wheat (Chicago +3c, Kansas +4c, Matif +1€)

StatsCan lifted its spring wheat estimate sharply to a record 29.3Mt, reinforcing a very strong Canadian export program that has already reached 7.8Mt by week 17.

ABARES raised Australia’s crop to 35.6Mt, adding further weight to global supply.

Early signals suggest Russia and Ukraine combined may produce roughly flat year-on-year in 2026, tempering the otherwise bearish tone.

Durum production was also raised, with StatsCan adding 600,000t to reach 7.14Mt, and exports remain firm enough to lift full-year expectations.

Algeria’s tender added further demand interest, likely securing at least 810,000 tonnes of soft wheat for February shipment at around USD$256, showing ongoing appetite in North Africa despite abundant global supply.

Other grains and oilseeds

Market moves: Other grains and oilseeds (Corn +3c, Soybeans +4c, Matif Canola +2€)

Corn futures firmed on confirmation of strong export sales, with the USDA reporting new flash business to Mexico and Colombia and weekly export sales of nearly 2Mt across the 2025/26 and 2026/27 seasons.

The market is increasingly focused on whether the WASDE will revise exports higher given the “record hot” pace.

Soybean futures also lifted modestly, supported by ongoing shipments of earlier Chinese purchases, though traders continue to watch for additional new-crop buying from China following the Trump–Xi commitment. Wheat futures were dragged along in sympathy.

Fertiliser prices in the US remain elevated, with half of monitored products rising this week, adding further pressure to US row-crop production costs and reinforcing expectations for strong nutrient replacement demand after record-large harvests.

Barley fundamentals remain exceptionally strong: StatsCan production rose to 9.73Mt on record yields, while Australia’s barley crop is estimated at 15.7Mt, also a record. EU barley exports have already reached 4.4Mt, more than double last year’s pace, and Canadian feed barley bids continue to strengthen seasonally despite larger supply.

Macro

Market moves: Macro (AUD +0.2 percent, Dow +120, Crude +0.40)

US jobless claims fell sharply to 191,000, the lowest since September 2022, though distortions around Thanksgiving may have overstated the improvement.

Broader labour-market indicators paint a much weaker picture, with the ADP survey showing a 32,000 decline in employment and both ISM employment components indicating contraction. Factory orders were mildly positive at +0.2pc m/m in September. The upcoming PCE data is expected to show a further step-down in consumption growth and stable but still above-target inflation, with core running around 2.8pc y/y. Goods inflation remains subdued while services inflation is sticky near 3.5–3.6pc y/y.

Analysts believe the broader disinflationary framework remains intact, driven by softer labour markets, moderating wages, and constrained household spending.

The University of Michigan consumer sentiment data will be watched for further deterioration in household confidence, which in November hit GFC-era lows for current conditions.

Markets continue to price a strong likelihood of a Fed cut next week.

On geopolitics, the EU is struggling to agree on how to finance Ukraine after the US withdrew its support. Brussels proposed using frozen Russian assets to back a €90 billion loan or alternatively using the EU budget, but Belgium’s opposition is creating significant friction given most assets are held at Euroclear. Von der Leyen argued safeguards would protect member states, while the US has applied pressure to accelerate a peace-oriented approach.

Ukraine still faces a €45 billion funding gap through 2027 even if the loan proceeds, highlighting the urgent fiscal stress heading into year four of the war.

Local

Bad day for canola yesterday with bids in the west falling to A$807 and GM to $686. APW was softer, down $2 to $338, while barley was steady to slightly stronger, bid $307 FIS Albany.

Through the east, canola was back around $10 to $795, wheat held steady at $342 and barley $307 track Melbourne.

Improved harvesting conditions forecast for the next 10 days across SA and Vic should lift grain flow; the market response will be key, with some near-term weakness likely.

Pulse bids continue to soften on the back of the stronger dollar, with faba beans now at $430 delivered Geelong/Melbourne Jan+, though some spot demand is attracting a small premium.