Wheat Market Outlook

While wheat markets do not look exciting to Mercantile because the demand side remains tepid and hard to define for the coming crop year, they do note that there seems to be room for high protein wheat once again. In the ongoing crop year, demand for good quality protein wheat confirmed good demand for Canadian wheat. This year, we see German wheat come in with lower pro than normal, while once ag...

Mercantile is watching the ongoing heat in Europe, where temperatures are expected to climb again mid-week. Protein seems to be the immediate problem with wheat, and Mercantile is watching yield outcomes in the EU and in Russia where there are questions about the crops in the Rostov and Volga regions (Mercantile says Siberia seems to look good). Mercantile would hold sales for now.

According to Mercantile, the market is not expecting any major changes in the USDA stocks and seeded area reports out today. Despite a weak U.S. dollar, slow harvest andweakening crop conditions, U.S. wheat prices will remain under pressure as crops in competing origins are harvested and are generally strong. Rain will drastically improve the condition of the crops in Saskatchewan and Alberta, sot...

According to Mercantile, the weather and political uncertainty are supportive for the markets. The market is watching the dry conditions in Russia and the EU. Meanwhile, estimates for Russia’s wheat crop remain big. Mercantile says there was good tender business last week, but the results continue to signal strong supplies in the Black Sea and Balkans. Meanwhile, spring wheat crops in the Northern...

Mercantile says harvest of, what is expected to be a strong new crop in the Northern Hemisphere, is approaching rapidly. Dry conditions in the northern U.S. and Canadian prairies are supportive for high protein wheats, but this can be eased with rain. Mercantile would be sold out of old crop wheat and would hold new crop wheat sales for now.

According to Mercantile, futures markets are acting like they have founda bottom. Meanwhile, cash markets are being pressured by the volume of new crop wheat that is jostling for demand. Increasingly dry conditions in the Canadian prairies have the market on edge, says Mercantile. The next USDA report is out on Thursday. Traders expect the USDA will increase U.S. wheat stocks for ‘24/25 while lowe...

According to Mercantile, thin demand ahead of the Northern Hemisphere harvest is presently the prime focus, but hi-pro supplies in North America is dwindling, and the new crop could be under threat. Building heat and dryness in the Northern U.S. shocked initial U.S. Spring wheat ratings, while there is no visible change to the dryness in China. Meanwhile, Mercantile says India is projecting a reco...

According to Mercantile, there is an increasing number of production challenges arising, and the wheat market will increasingly focus on the weather. Mercantile says the trade is watching how production issues in some areas (Russia, China), will come against strong crops in other regions (the U.S., eastern Europe). Mercantile would continue to hold wheat sales for now.

Mercantile considered the WASDE bearish on wheat although it’s a long time before it is in the bin. World disputes continue, U.S. stocks are expected to rise, and U.S. wheat is very competitive and is attracting strong new crop demand. Mercantile says the UDSA expects imports by some of Canada’s top customers will be higher in the upcoming year (Indonesia, Philippines, Bangladesh, China) which cou...

Mercantile has a new WASDE report this Monday, where they expect the USDA to increase stocks and improve expected supplies of new crop wheat. Mercantile anticipates new crop markets to be a little lower, but old crop should strengthen with buyers coming back in. Mercantile doesn’t see any large moves by Funds and would remain non-sellers of Canadian wheat.

According to Mercantile, it was a slow week as various parts of the world take May 1, 2025, as a holiday. In the markets, soft red wheat easily remains the world's cheapest wheat and funds hold record shorts, but dryness issues persist in areas of Europe, parts of Russia and Ukraine, parts of Canada, and China. Mercantile says wheat could take a further rally and increase its value relative to...

According to Mercantile, Australian futures fell another A$6/mt as the AUD made a new four-month high close, while MATIF fell to new contract lows on slow demand, high stocks and generally favourable weather conditions. Rain has largely subsided weather concerns in most of the major wheat origins. So, Mercantile says world wheat markets remain under pressure by the absence of significant weather i...

Apr. 21

According to Mercantile, weakness of the U.S. dollar should help support U.S. sales, but demand continues to be slow. The attention of the trade will continue to turn towards new crop conditions and weather in the Northern Hemisphere. Mercantile is hearing of some strong targets being rewarded. If 75 per cent sold old crop, Mercantile would hold additional wheat sales for the present.

According to Mercantile, dryness in the U.S. winter wheat belt is supportive, but politics are weighing on U.S. futures. Mercantile adds that Canada is well positioned to service additional demand if buyers (especially from Asia) choose to switch from the U.S. in retaliation to the U.S. tariffs. Canadian cash prices should remain strong in Mercantile’s opinion, but this might have to come from str...

According to Mercantile, the Prospective Plantings report was supportive for wheat adding, the report is often incorrect, but it is the first public indication of U.S. seeding intentions. Mercantile says trade remains slow on both old and new crop, and unshipped old crop will add to new crop supplies and the lack of new crop demand does not make for an inspiring 2025/26 wheat market. Mercantile ex...

According to Mercantile, U.S. wheat remains competitive on the global market on an FOB basis, but the potential of higher charges on Chinese vessels are adding uncertainty, and global demand for wheat remains sluggish. Turkey is reportedly lifting its restrictions on wheat imports, so Mercantile is interested in seeing what they will do. Otherwise, importers are increasingly acting as if they are...

Despite some jostling in the price of competing origins, Mercantile says global prices have remained relatively steady despite the volatility experienced in North America. Old crop wheat supply seems to be matching demand, albeit, as per the USDA, stocks in major exporting nations will be higher than originally thought. According to Mercantile, trade tensions will add instability to the spring mar...

Mar 10, 2025

Mercantile says, indiscriminate tariffs would be terrible for Canadian agriculture. While both Canadian durum and non-durum wheat markets are exposed to the U.S., Mercantile says non-durum wheat should face less of an impact. According to Mercantile, the U.S. will need to continue importing durum wheat, but likely in heavily rationed volumes. Meanwhile, a lower Canadian dollar should allow Canada...

According to Mercantile, Russian exports have slowed dramatically which is supportive to global prices. Mercantile notes cold conditions likely hurt the Black Sea and U.S. crops, but it will be difficult to determine the impact until condition ratings are released. If conditions are reported to be poor, Mercantile assumes the market could react accordingly and give some pricing opportunities for b...

According to Mercantile, the USDA report was supportive for old crop wheat. Some tender business last week was also good to see in an otherwise demand-deficient market. Mercantile says dry conditions and winter-kill concerns in the U.S., Russia and Ukraine, and marginal conditions in France have the bears on edge.

According to Mercantile, wheat markets remain supported. Mercantile says wheat continues to be cheap compared to corn and attention is increasingly turning to the new crop. There are several areas of concern  for the 2025/26 winter wheat crop according to Mercantile, including Russia, Ukraine, France, and parts of the U.S. The next USDA report is out on Feb. 11, 2025.

Outside of the looming trade wars, Mercantile says the wheat market is well supported: conditions in many of the key growing areas are not ideal, the funds continue to hold a large short position in wheat, and buyers (Egypt) are showing more demand. Also, Mercantile believes the corn market is very strong so long as the U.S. and Mexico continue to trade. According to Mercantile, the strong U.S. do...

According to Mercantile, wheat demand remains sluggish, and wheat continues to have little independent strength. Strong corn markets are propping up wheat values, the premium wheat holds over corn is narrow in both the futures and cash markets. Mercantile says the spread between the fund’s short in wheat and long position in corn is a record and could provide an opportunity should the funds decide...