Market players told Expana that grain prices remain under pressure, primarily due to persistent global oversupply. Analysts said that exceptionally strong harvests continue to weigh on prices, while exchange rate movements and geopolitical uncertainty are further reducing marketing opportunities and dampening investor sentiment.
Analysts added that the acceleration of harvest activity in Australia and Argentina has recently contributed to the bearish tone. In Argentina, crop tours conducted by the Bahia Blanca Grain and Products Exchange have strengthened expectations for higher yields, with second-day results showing an average wheat yield of roughly 4.5 t/ha across the Mar, Sierra, Laguna, and Pampa circuits. Overall projections point to about a 13% year-on-year increase. However, market players warned that late-season frosts and excess rainfall could threaten final yields, noting that a higher-than-expected share of feed-quality wheat is arriving at ports. The Buenos Aires Grain Exchange reported that as of November 19, the wheat harvest was 20% complete, compared with 29% at the same point last year. Sources attributed the slower pace to excessive moisture in the fields.
In Australia, the Western Australian Grains Association raised its wheat production forecast by 0.42 million mt to 13.05 million mt last week, up from 12.45 million mt last year. Total production forecasts among market players and the USDA range between 36–36.2 million mt. Participants are awaiting the Australian Bureau of Agricultural and Resource Economics & Sciences (ABARES) update on December 2 for a clearer outlook, as the latest available estimate from September (33.8 million mt) is widely viewed as outdated.
Combined with abundant global supply, weaker Chinese demand has amplified bearish sentiment, particularly for Australian wheat.
The Euronext wheat futures market has mirrored the bearish sentiment, with prices down 1.82% month-on-month as of November 26. On the physical side, the Expana Benchmark price for German feed wheat (Expana code: AG11) has declined by 2.4% this quarter, while 11.5% protein French milling wheat (Expana code: FR11) has fallen by 2.24% over the same period.
Written by Ben Barritt
