Global Wheat Market Notable Items
Global
- Wheat markets enter the week trading slightly lower and off their early September contract highs. The September USDA WASDE was not particularly bullish from a headline global-supply standpoint: USDA raised 2026/27 world wheat production by 3.1 MMT to 822.4 MMT and increased projected ending stocks by 3.0 MMT to 276.3 MMT. However, those stocks remain below last year’s 280.6 MMT, while USDA simultaneously reduced Russia’s wheat export forecast by 3.0 MMT to 43.0 MMT and Ukraine’s by 1.0 MMT to 12.5 MMT. The market is grappling with the fact there may be more wheat in the world than previously estimated, but less certainty around where exportable wheat will come from and how easily it can reach importers.
- Saudi Arabia made no purchase in its recent 535,000-tonne milling-wheat tender, with traders citing elevated prices associated with Black Sea disruption as a likely reason for the cancellation. However, Jordan has a tender for up to 120,000 tonnes closing Tuesday, while Pakistan has entered the market for a much larger 750,000 tonnes of milling wheat with bids due Wednesday. The results of these tenders will be particularly useful to see importer’s appetite for wheat at the higher values being presented in the market due to current geopolitical premiums. Continued purchases at elevated prices would validate the new freight and geopolitical premium, while repeated cancellations would indicate that importers are willing to wait the market out until absolutely required.
- Black Sea logistics remain the strongest international support underneath the wheat market. Russia moved approximately 46.3 MMT of grain through the Azov and Black Sea during 2025/26. Russia is attempting to redirect more grain north toward Baltic routes, but its own Baltic ports are estimated to have capacity of only around 7 MMT annually, while moving southern Russian grain north can add an estimated US$30–50/t in transportation costs.
- The result is that Russia can still possess a very large wheat crop while being substantially less competitive or reliable on a delivered basis. French wheat is already beginning to win additional North African business as freight, war-risk insurance and execution uncertainty erode Russia’s traditional FOB advantage.
- The Baltic states are making Russia’s alternative export routes even more difficult. Latvia is looking to be moving forward with a proposed 300 per cent charge on Russian and Belarusian grain. Estonia and Lithuania have also discussed restricting the use of their ports for Russian grain. Estonia has gone further, saying it is prepared to impose its own sanctions if Russian grain begins shifting through Estonian ports.
- Ukraine had harvested approximately 24.9 MMT of wheat from 98 per cent of intended area by early September, and USDA raised its 2026/27 production estimate to 26.0 MMT. Yet USDA simultaneously reduced Ukraine’s export forecast to only 12.5 MMT because of weak shipments and continuing Black Sea logistical disruption. The wheat exists, but a growing portion could remain inside Ukraine rather than competing aggressively in the international market.
- Ukraine’s export scenario is a bit more fluid although they have less access to Black Sea shipping, there is somewhat more openness to cross border transit over land.
- FranceAgriMer’s Final Quality results show 89 per cent of the 2026 French soft-wheat crop at 11 per cent protein or better, 63 per cent at 11.5 per cent or better vs 51 per cent five-year average prior, 97 per cent meeting or exceeding 76 kg/hl test weight vs 61 per cent five-year average and 100 per cent meeting the 250-second Falling Number test vs 85 per cent in the five-year prior average. These are strong quality results and considerably better than historical averages. These figures will increase the overall supply of higher quality milling wheat available to importers looking for alternative sources of high-quality milling wheat.
- There are also substantial supply offsets developing in the Southern Hemisphere. USDA raised Australian wheat production another 3.0 MMT in September to 31.0 MMT after ABARES had already increased its forecast earlier this month. Argentine wheat conditions also remain exceptionally strong, with the Buenos Aires Grain Exchange reporting approximately 95.9 per cent of the crop in normal-to-excellent condition and 89 per cent of the area with adequate-to-optimal moisture. Australia and Argentina remain the two major regions to be harvested by the end of 2026 once the Canadian wheat crop is off and in the bin. The two regions’ trending higher production figures could keep a cap on a “global shortage” wheat rally and temper a bull market somewhat.
Canada
- Canadian harvest and quality have quickly become one of the most important issues for the higher-quality wheat market. Saskatchewan was only 27 per cent harvested through Sept. 7, 2026, compared with the five-year average of 58 per cent. Just 13 per cent of spring wheat, 38 per cent of durum and 41 per cent of barley were complete when the report was compiled. Some areas received extraordinary rainfall of 5+ inches. There are substantial concerns around waterlogging, bleaching and sprouting. Harvest activity resumed in several areas later last week, but early producer and trade reports are increasingly showing downgrades in wheat and barley crops
- The Canadian story is therefore moving away from yield alone and increasingly toward grade distribution. There may still be a relatively large Canadian wheat crop, but the amount ultimately grading No. 1 or No. 2 CWRS and the quality of the remaining durum crop could become considerably more important than the national production number itself. Falling number, sprouting, test weight and general grading results will be closely watched as the remaining Prairie crop comes off. A sustained stretch of warm, dry weather will allow harvest to advance very quickly, but producers continue to work around rain systems, and the longer unharvested wheat remains in the field, the greater the quality risk becomes as we move into the back half of September.
- Statistics Canada’s August production estimates on Wednesday will be the major Canadian report this week. The model-based estimates for wheat, durum, canola and other principal crops are scheduled for the morning of Sept. 16, 2026. These estimates use satellite imagery primarily so they will do their best to estimate yield, however, because they are fundamentally an August production estimate, they will tell us essentially more about tonnage than about the quality deterioration that has occurred following the recent September rainfall.
- Last week’s Statistics Canada July 31, 2026, end of marketing year stocks report provided Canada with a considerably larger carry-in cushion entering 2026/27. July 31 all-wheat stocks were estimated at 6.65 MMT, up 56.8 per cent from last year, including 5.55 MMT of wheat excluding durum and 1.10 MMT of durum, with durum stocks more than double year-ago levels. Barley stocks came in at 940,000 tonnes, down 24.7 per cent, oats came in at 577,000 tonnes and canola 1.90 MMT. Canada also exported a record 29.7 MMT of wheat during 2025/26. The larger wheat and particularly durum carry-in tempers the outright bullish supply argument, but large stocks do not necessarily replace high-grade new-crop wheat if a meaningful portion of the 2026 crop is downgraded.
- We are recommending Canadian grain producers obtain good, representative samples of their wheat before making marketing decisions this fall. Grade spreads are at risk of widening, and lower-quality wheat could face substantial discounts where grain moves from a #2 into a #3 grade or lower. We continue to like the direction wheat values are trending and encourage producers to take advantage of the roughly $1.00/bu rally seen in recent weeks to build fall cashflow and improve logistics. However, sales should only be advanced once grade and key quality specifications are confirmed. Wheat marketing may require more fine-tuning than usual this season, as recent rainfall is expected to create significant variability in grade and quality across Western Canada.
- We should get updated Saskatchewan yield figures this week but as of Aug. 31, 2026, initial Saskatchewan yield estimates are generally stronger for the major cereals than last year’s provincial report around the same timeframe, with durum at 44 bu/ac versus 38, hard red spring wheat at 52 versus 50, barley at 74 versus 71 and winter wheat notably higher at 55 versus 44 bu/ac. Canola is essentially unchanged at 38 bu/ac versus 39 last year
- Alberta’s early 2026 dryland yield estimates are slightly below last year for the major cereals, with spring wheat at 53.1 bu/ac versus 54.6, barley at 71.0 versus 72.6. These comparisons should be treated cautiously, however, as the 2026 estimates are from September 8 while last year’s figures were from September 23 (closest correlating dates), giving the 2025 numbers several additional weeks of harvest information.
Market Outlook – Wheat
The latest WASDE increased global wheat production and ending stocks, but lower Russian and Ukrainian export forecasts, continue to tighten the outlook for readily available exportable wheat supplies. In Western Canada, the focus is increasingly shifting from total production toward grade, with recent rainfall raising quality concerns. A good stretch of warm, dry weather could still allow Prairie harvest to advance quickly, but further delays would increase quality risk. Statistics Canada’s production estimate, Canadian harvest progress and developments around Black Sea shipping are likely to drive direction this week.
Market Outlook – Durum
The durum market also remains increasingly focused on quality rather than outright production. Canada entered the crop year with a relatively comfortable 1.1 MMT of carry-in stocks, which limits concerns around an outright shortage. However, recent rainfall across major durum-growing regions has increased uncertainty around the percentage of the crop that will ultimately grade No. 1 and No. 2 CWAD. If additional downgrading is confirmed as harvest progresses, stronger premiums could develop for higher-quality durum even if total Canadian production remains adequate. Near-term direction will depend heavily on final grade.
(SaskWheat news release)
