Weather: I will be the first to say it this year…wheat is a weed. It won’t be the last time you hear it. Weather looks challenging in several parts of the growing belt and its understandable that the spec is getting a little excited. However, this time of year can change quickly. Kansas rainfall looks virtually non-existent for the next 2 weeks but, the context is the March normal rainfall is around 50mm – ie one storm can change everything. The ice crusting in Ukraine that is doing the rounds of the wires is possible but probably isolated if we are simply looking at the recorded temps.
I’m not saying there isn’t a need to build risk premium – quite the opposite, however, we always need to add context.
Markets
Pretty good technical finish in wheat overnight with the May contract closing above the 200-day moving average. Spec positioning has been a tough one to trade pretty much since COVID. It feels like the funds are way more sticky than they used to be – IMO this probably suggests more basket and/or spread trading rather than directional.
AUD is wading through some mixed information – not least of which was the US Fed minutes which raised concern over the rate direction. This has tempered the more aggressive AUD views that have been hinged off a rate differential between Aust and the US.
Australian Day Ahead
Pretty lacklustre performance across the board yesterday – I get it, wheat futures have done a great job of getting the market excited only to find a wave of selling. Australia is still pushing against a lack of export demand, particularly after the USDA gave Argy an 18 million tonnes (Mt) export program.
Canola should find a bid – El Niño new crop pressure coupled with global veg oil demand should see more interest, however, the trade would be concerned with finding tons to justify building a book – would you be confident of accumulating a vessel worth of canola from the grower, even with an export margin.

Global wheat:  Chicago +12.50, Kansas +14.50, Matif +3.00
Wheat remains in a technically driven breakout phase, with momentum sustained after the sharp short-covering rally. The contraction in spreads and elevated volatility continue to pressure entrenched short positioning, particularly given the extended duration of the managed money short.
Matif followed higher, reinforcing the global tone, while Russian cash markets edged up modestly.
Sentiment rather than fresh fundamental change continues to dominate price action, with traders focused on positioning, volatility and the durability of the breakout.

Other grains and oilseeds: Corn -1.25, Soybeans +7.50, Matif Canola +5.25
The canola uptrend extended, with the May contract holding above the C$680 level, a chart signal that encouraged further speculative buying.
Strength in Chicago soyoil and soybeans continued to provide spillover support, while European rapeseed and Malaysian palm oil were also firmer. Crude oil strength underpinned the broader vegetable oil complex.
Updated supply and demand estimates from Agriculture and Agri-Food Canada showed only minor balance sheet adjustments.
Ending stocks for the current year were revised marginally to 2.760 million tonnes, while 2026/27 carryout was raised slightly to 1.660 million tonnes, indicating no major tightening but also no material loosening.
Trade volume remained elevated with spreading a key feature, highlighting active positioning within the curve.
Corn remains comparatively subdued despite the wheat-led surge, reflecting ample supply expectations and limited fresh catalysts. Soybeans continue to benefit from veg oil strength and biodiesel-related optimism..

Macro: AUD0.7050, Dow -267.50, Crude +1.24
Crude oil strength continues to lend support to the broader commodity complex, particularly vegetable oils.
Equity markets softened, with the Dow lower, reflecting ongoing macro caution amid mixed US economic data and persistent geopolitical uncertainty.
The Australian dollar was steady.
The broader macro environment remains characterised by softening US demand indicators, a widening trade deficit and cautious Federal Reserve messaging.
At the same time, geopolitical risks and trade realignment narratives continue to influence cross-asset flows, reinforcing elevated volatility across commodities.

Local: Through the west of the country bids were stronger across the board, with canola $780 and GM $705, wheat $318 and barley $324 FIS Albany.
In the east, canola was $755 and GM $668, wheat $321 and barley $302 track Geelong.
Barley saw some liquidity through the east earlier, though that appears to have dried up over the past week. Growers remain proud holders of wheat and, with cashflow largely met through canola and selective cereal sales, that stance is unlikely to shift materially in the short term.
Sorghum remains well bid, with Newcastle around $367, Brisbane $363 and Darling Downs in the low $340s.