GrainGrowers Market Update
Wheat prices have continued to climb in August, hitting three-year highs and reaching their highest level since June 2023. As of 27 August, the CBOT wheat futures price was 748.25 USd/bushel.
Several factors are contributing to the surging wheat price, including a failed agreement between Russia and Ukraine to cease attacks on vessels carrying agricultural cargo in the Black Sea, which has seen the world’s biggest shipping company, MSC, stop servicing some Russian ports. Disruptions to the Black Sea shipping route have a material impact on global wheat supply and prices, as Russia and Ukraine are the first and fourth largest wheat exporters globally.
A downgrade of US corn harvest yields in key Corn Belt states, specifically Illinois and Iowa, has driven the corn futures market to its highest level since February 2025. France is expected to have its smallest corn harvest since 1980, compounding concerns about corn supply, especially in Europe. As of 26 August, the corn futures price sat at 536 USd/bushel. Higher corn prices are supporting high wheat prices at present.
The Indian government announced this week that it would scrap its export ban on wheat, but this has not yet impacted wheat prices. As the second biggest wheat producer behind China, growing over 100 million tonnes a year, India entering the export market could place downward pressure on wheat prices by meeting the supply shortage caused by the Black Sea conflict.
Canola prices remain relatively high, but below the two-year highs achieved in July. Currently, ICE Canadian canola futures sit at $795.1 CAD/tonne. The market is looking to see how the US-Canada tariff exchange develops, as the US is a major market for Canadian canola oil. The US is the biggest importer, taking 1.48 million tonnes a year, or 87% of all Canadian canola oil exports.
From a production perspective, on 14 August the Grains Industry Association of WA (GIWA) released its forecast of the 2026 WA winter crop harvest. The forecast revised WA grain production down 7.3%, or 1.6 million tonnes, to 21.012 million tonnes, following dry and windy conditions throughout July.
For the first time in WA, in 2026 there will be more canola and barley produced combined than wheat. This dynamic reflects growers considering commodity profitability and fertiliser dependence planting crops this year.
The Department of Primary Industries and Regions (PIRSA) forecasts SA’s grain production to be 9.79 million tonnes—the fourth highest on record behind 2010, 2016 and 2022—demonstrating the strong season in SA, while noting that strong production volumes may not necessarily translate to strong profits given the cost of inputs this year.
Brent crude futures are sitting at $87.49 USD/barrel—1% below prices a month ago, when they sat at $88.36 USD/barrel. Prices peaked this month on 21 August following the expiry of the peace deal between Iran and the USA.
Two reports have been released in the last two weeks underpinning the strong demand for feed grain within the Australian livestock and chicken industries.
Last Tuesday, the ABS released its livestock products data for the June 2026 quarter and the full 2025–26 financial year. The data showed record poultry production, with 200.58 million birds processed in the June quarter and 781.67 million birds for thefull financial year (FY2026), representing an increase of 3.9% on FY2025, the previous record. This highlights the continued growth of the poultry industry in Australia and demonstrates the growing demand for domestic feed grain to service Australia's chicken flock, which is estimated at 4.7 million tonnes (including layers).
ALFA and MLA released a publication on the number of grain-fed cattle in Australia and the capacity of the feedlot sector. The results showed that in FY26, more than 4 million grain-fed cattle were processed for the first time ever. Feedlot capacity also continued to climb to record levels, sitting at 1.79 million head. These numbers, like those of the chicken industry, demonstrate committed investment in their respective sectors and continued strong growth in demand for Australian feed grain.
ABARES will release its September Crop Outlook next Tuesday, 1 September 2026, providing its most current estimate of the upcoming national winter crop harvest.
Argus Media Fertiliser Report
Urea
Domestic demand for prompt granular urea remains slow and the market is looking more to summer crop demand starting in September.
Argus last assessed granular urea at A$790-810/t fca Geelong.
There are two vessels carrying 63,000t of urea in transit to Australia, vessel tracking data from Kpler show. Urea supply is sufficient for demand from late September but there is little prompt urea availability, an importer said.
August rainfall in all southern grain growing regions has improved grower sentiment but northern New South Wales and Queensland remain very dry, suppliers said.
Phosphates
Domestic demand for prompt MAP/DAP remains low but some selling for later collection has taken place.
News
Australian agribusiness and parent company of Incitec Pivot, Ridley Agribusiness has seen slower fertilizer demand than normal since the start of July, despite strong growing conditions, because of demand destruction and earlier buying when customers saw the risk of short product, the company said on 20 August.
The company’s urea margins increased because of a rise in global prices after war broke out in late February but were partially offset by demand destruction. Ridley holds a sales agreement for Phosphate Hill until March 2027 and plans to prioritise domestic demand over exports because of Australia’s supply constraints
Fertiliser commentary and pricing supplied by Argus Media
Disclaimer: The information provided in this report is general in nature and is intended for informational purposes only.