Global crop upgrades are putting pressure on local prices
Wheat markets were already expecting a big global crop, but recent production updates have pushed supply even higher.
Australia’s production estimate has been lifted from around 33 million tonnes to roughly 35.6 million tonnes. Canada, helped by timely rain late in the season, is now on track for a record 40 million tonne harvest, and Argentina is forecasting a crop of 27.7 million tonnes, about 50 per cent larger than this time last year, and sending record volumes to ports.
“Farmers are delivering record amounts of wheat to the market, to local ports, and it is causing a weakening in prices,” Voznesenski said.
Argentina’s export offers are flowing through to Australia
Argentinian wheat is landing on global markets at noticeably cheaper levels.
“If you look at the price on a ship, it is now noticeably lower than all the global prices, including here in Australia,” Voznesenski said.
Because Argentina and Australia harvest around the same time, their export offers often compete directly, especially in Asia.
“Argentina is willing to sell in Asia for a lower price. We don't really have an option, we have to compete from a price perspective and that means our prices have to weaken as well,” he said.
Demand is improving, but supply is still winning
There are positive signs in export data, with stronger buying from Asia and the Middle East.
“You look at Canadian, US, Russian and Ukrainian exports - they've all been quite strong, meaning someone's buying this wheat,” Voznesenski said.
Even so, the sheer volume of grain this season is keeping prices from lifting.
“Yes. Demand is picking up. That's a positive as always, but there's just simply too much wheat around,” he said.
What could shift the market heading into 2026?
While today’s price story is mostly about abundant supply, Voznesenski is watching two key risks that could jolt the market next year.
1. Tension in the Black Sea
Shipping disruptions have resurfaced, with attacks on cargo vessels pushing up war-risk insurance premiums.
“If those tensions keep rising, that could cause prices to go higher,” he said.
2. Spring weather across the Northern Hemisphere
Crops across Europe, the US, Russia and Ukraine will emerge from snow cover in March and April.
“If it is very dry, when the crops come out of the ground into dry conditions, it could cause notably higher prices,” Voznesenski said.
He says an escalation in the conflict between Russia and Ukraine would also shift the market.
A single supply shock - geopolitical or weather-related - could flip the current trend of low prices.
A subdued outlook for now, but things could change quickly
For now, Australian wheat prices are responding to strong production at home and abroad, along with more competitive offers from Argentina. But Voznesenski says the story doesn’t end there.
“Overall, there’s a lot of supply but demand is picking up and all it takes is a supply side issue for markets to change direction,” he said.
Some major importers are also rethinking their approach to food security. Egypt, for example, plans to plant more wheat next year, a shift Voznesenski says is worth keeping an eye on.
“Large importers focusing a bit more on food self-sufficiency,” he said.
