The day ahead
Weather – Russian winter crop weather is bleeding into every daily wire. Already the crop is in terrible shape, but historically there is a very low correlation between pre-dormancy weather and final yield.

Rostov-on-Don cumulative rainfall, chart on the left, and periodic temperature on the right. Rainfall (dark blue line) is very much below mean (black line). Temperatures in most month have been hotter than mean. Source: Bloomberg via Lachstock. Click expand
The main concern is the lack of snow cover in the major producing areas and the fact the temps are swinging all over the place. The GFS forecast takes temps from 3°C to minus 6°C, not super unusual but a winterkill risk all the same. Some decent rainfall forecast for Argy but still some divergence between the models.
Markets – I am always impressed with a market that finishes exactly unchanged, i.e. yesterday was exactly the right price – beanoil wins this prize. Wheat has managed a three-peat, adding US33c/bu over the last three sessions. Russia the main driver.
Australian day ahead – Without much fanfare it feels like the feed market has caught a bid. Certainly location-dependent but it seems that there are a few trade shorts that are still looking for coverage. AUD still treading water but feels heavy today – 0.6128 the support level that I feel needs testing.
Offshore
There is an extreme level of uncertainty surrounding the tariff plan of President Trump. The first day of February, “D-day” for Canadian 25 percent tariff is upon us. He doubled down yesterday, renewing his pledge to slap a 25pc tariff on imports from both Canada and Mexico, which hit both the Canadian dollar and the Peso. Based on this move it would seem the market, and I, thought he would use this as a negotiation and not actually implement this.
Black Sea market analyst SovEcon followed the Russian Grain Union, lowering Russian wheat exports to 42.8 million tonnes (Mt), a reduction of around 2pc.
The National Australia Bank changed its call on Thursday to join the pack of Aussie banks looking for a cut in the Feb meeting. FWIW – I say no cut in Feb.
China produced 96.6Mt beef, pork, mutton and poultry in 2024 which reflects an increase of 0.2pc year on year according to its National Bureau of Statistics. Beef was the big driver, increasing 3.5pc to 7.8Mt. Australia produced 2.2Mt carcase weight beef and veal.
According to the USDA, the US cattle herd may continue to shrink well into 2025. The Cattle on Feed report will be out tonight.
The European Central Bank lowered interest rates for the fifth time since June, responding to a stagnating regional economy and inflation nearing the 2pc target. Policymakers reduced the deposit rate by 0.25 percentage points to 2.75pc, in line with forecasts from all analysts surveyed by Bloomberg. While it still characterises its monetary policy as “restrictive,” the ECB may reconsider this designation at its next meeting in March.
Australia
Western Australian canola bids were largely unchanged yesterday with conventional bid around $840 for current crop and $795 for new. Cereals were slightly firmer with wheat $375 and barley $340.

Canola shipment per month from Victoria. November and January pace (broken red/black line) exceeds previous year (blue line). ‘000 tonnes. Source: Lachstock. Click expand
Eastern Australian canola bids were steady around $765 for current crop and $730 for new. Wheat was a little firmer around $345 with barley $327.
New crop delivered barley bids are starting to be posted, with Jan+ 2026 bid $330 delivered Geelong/Melbourne and delivered Darling Downs $320.
Victoria exported 458kt canola up to end January, out of an estimated 613kt 2024-25 program or 75pc completed. Bear in mind this has been done in the first quarter of the marketing year.
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