AM Market Report – October 28, 2025

GOOD MORNING…HERE IS YOUR MORNING MARKET NEWS

OVERNIGHT GRAIN TRADE

ICE canola futures are edging $1/tonne higher this morning…supported by this week s CBOT soybean rally, but retrained by weaker overnight price action in CBOT soyoil, Malaysian palm oil and EU rapeseed.

Chicago soybean futures are posting follow-through gains of mostly 10 cents/bu this morning. CBOT corn futures are 1 to 2 cents higher.

US wheat markets are also higher again this morning…winter wheats leading with 5 to 6 cent gains, while Minnie spring wheat futures are 4 to 6 cents high.

AM Market Report – October 27, 2025

GOOD MORNING…HERE IS YOUR MORNING MARKET NEWS OVERNIGHT GRAIN TRADE ICE canola futures are trading mostly $4 to $6/tonne higher…

A sharp rally on Monday helped US soybean and wheat markets close double-digits higher and corn up a nickel…ICE canola was only flat to slightly higher. The rally was driven by news that the US and China agreed on a preliminary consensus for soybean sales to China.

Technical chart postures across many US grain/oilseed markets have improved markedly the past couple weeks, which are inviting spec fund traders to play the long sides of the markets. This comes amid the political hope of improving US-China trade relations, with the APEC summit meeting on Thursday between Presidents Trump and Xi Jinping.

Be aware though…while media headlines suggest a trade agreement is imminent, traders have seen this type of trade talk collapse before.

Talk all sounded positive from the US side coming out the weekend. From China though…only came acknowledgment a framework for talks, but non-committal on any deals. So it s been market speculation this week…shoot first (buy), take names later, as funds cover shorts or add some longs. The devil is in the details and that will not be known until late this week. Headline trading theme continues.

In Other News

– No Carney-Trump talks… US President Donald Trump says he isn t planning on talking trade with Canada for a while. Trump was asked whether he would meet with Prime Minister Mark Carney in South Korea at the Asia-Pacific Economic Cooperation summit later this week. Trump responded that he doesn t want to meet with Carney. This comes after Trump threatened last weekend to hike tariffs on goods coming in from Canada, in continued reaction to a TV ad by the Ontario government using a speech by former US President Ronald Reagan criticizing tariffs.

– Carney to meet with Xi… Meanwhile Prime Minister Carney says he plans to meet with China s President Xi Jinping this week at the APEC summit in Korea. While speaking in Malaysia during his trip to Asia, Carney said he plans to discuss bilateral trade between the two countries and says he could see progress on easing the travel restrictions between the two countries as well as supporting Canada s agriculture, fishery products and manufacturing sectors.

– Canada s trade tightrope… These aren t exactly banner times for Canada/US relations, according to a Globe and mail report. Whatever progress Canada might have made on trade talks with the White House…yesterday, Prime Minister Mark Carney said the countries had been close to a deal …those negotiations screeched to a halt after the Ontario government ran its 60-second, Reagan-quoting, anti-tariff ad. Now US President Donald Trump is promising a tariff hike and a long stretch of time before he decides to meet again with Carney. And Ontario Premier Doug Ford isn t showing much contrition for his role in the matter: He just called the ad the most successful in North American history, borrowing a bit of Trumpian hyperbole.

Perhaps Carney will have better luck with Chinese President Xi Jinping when the two sit down at the APEC summit in South Korea later this week. The Prime Minister emphasized yesterday that there s lots of diplomatic room to grow here: China is a country with whom we had no senior-level contact in seven years, he told reporters from Kuala Lumpur. We re starting from a very low base. His meeting with Xi might not hard-launch a new Sino-Canadian relationship, but Carney said it could begin resetting expectations of where the relationship can go.

It is also the result of some fence-mending by Foreign Affairs Minister Anita Anand, who was in Beijing earlier this month to kickstart talks. Relations between the two countries have declined steadily since 2018, when Ottawa arrested Huawei executive Meng Wanzhou on a US extradition request, and Beijing locked up Canadians Michael Kovrig and Michael Spavor in response. Ottawa has since accepted dissidents from Hong Kong and beefed up its representation in Taiwan. In 2021, Parliament condemned China s treatment of the Uyghurs as a genocide. The next year, cameras caught Xi berating former Prime Minister Justin Trudeau at the G20 for leaking details of a brief conversation.

And then there are the tariffs. Back in 2024, Trudeau and the Biden administrations collectively slapped 100% tariffs on China s electric vehicles, in order to protect the North American auto industry from a glut of Chinese EVs. They also imposed 25% levies on Chinese steel and aluminum for good measure. In response, Beijing whacked Canadian canola oil and peas with a 100% tariff, Canadian seafood and pork with a 25% tariff, and Canadian canola seed with a very specific 75.8% tariff.

Beijing has said it d be more than happy to drop its retaliatory tariffs if only Canada would lift the levies on EVs…and the premiers of Manitoba and Saskatchewan, both major canola-producing provinces, have urged Carney to do just that. The Prime Minister didn t expressly rule out the move yesterday, though he remained circumspect, pointing only to travel restrictions between the two countries as a specific barrier to tackle. There is an argument, though, that Canada s protectionist policies may have outlived their purpose. Trump has been very clear he wants to stop buying cars from Canada, which rather seems to undermine any joint effort to safeguard the North American auto industry from Chinese EVs.

Carney says the rapprochement with Beijing is long overdue. This is our second-largest trading partner. This is the second-largest economy in the world, he told reporters yesterday. Perhaps offering concessions to China won t massively inflame Canada s trade tensions with the States. Trump said yesterday he s close to inking his own deal with Xi, and in any event, the White House s trade talks with Ottawa are already off. (Or, at least, they re off today.) But diplomatic experts warn that one compromise could swiftly lead to another.

– Agriculture minister to meet with Chinese officials… Federal Agriculture Minister Heath MacDonald is in China this week in hopes of strengthening agricultural ties between the countries. MacDonald will visit Shanghai, Beijing and Qingdao between October 27 and November 3. He plans to meet with senior Chinese government officials, local business leaders and other stakeholders. The trip is the latest diplomatic foray in the midst of trade tensions between the two countries.

– Monsoon promise turns sour for India’s crops… Indian farmers’ hopes for bumper crops following this year’s abundant monsoon rains were dashed by heavy downpours just before harvest that damaged their fields, crushing the dreams of millions who rely solely on agriculture for their livelihoods. The yield losses to crops such as cotton, soybeans and pulses are expected to slow agricultural growth, boost farmers’ debt and cap rural consumption

Summer-sown crops such as soybean, cotton, rice, pulses and vegetables mature from September, a month that saw rains of 15% above average this year, with some regions getting as much as 115% more than normal. While agriculture contributes just 18% to India’s economy of nearly $4 trillion, almost half its population of 1.4 billion relies on farming to earn a living.

Now farmers are scrambling to harvest summer crops ahead of winter sowing set to begin next month, but more untimely rain forecast this week could delay planting and further damage late-maturing summer crops. The rain-damaged crops are earning prices well below government minimum support prices, as quality has deteriorated.

The excessive rain has boosted soil moisture for winter-sown crops such as wheat, rapeseed and chickpea, but many farmers say they lack funds for seeds and fertilisers.

Damage to soybean and cotton crops is expected to boost India’s vegetable oil imports in the marketing year from November by 1.5 MMT to a record 18 MMT, says industry analyst Thomas Mielke of Oil World.

– Russian wheat export price little changed… Russian wheat export prices changed little last week, with analysts continuing to raise their forecasts for October shipments. The price for Russian wheat with 12.5% protein content for free-on-board (FOB) delivery at the start of December was at US $230.50/tonne at the end of last week, down $0.50 from the previous week, said the IKAR consultancy. The SovEcon consultancy estimated the price for Russian wheat with 12.5% protein content at between $230 and $233/tonne FOB compared to $230 to 231 the previous week.

SovEcon left unchanged its estimate of October wheat exports at 5.1 MMT. IKAR estimates that wheat exports in October may reach 5.5 MMT…a week earlier the estimate was just over 5.0 MMT.

– Interest rates in the spotlight… Interest rates will be in the spotlight this week, with both the Bank of Canada and the US Federal Reserve announcing their latest interest rate decisions on Wednesday. Both central banks are expected to cut rates, despite some recent stronger-than-expected economic data, as well as persistently high inflation. However not all observers feel the cuts are a certainty. US investment bank Morgan Stanley is out with a new report saying it expects a dovish hold from the Bank of Canada this week, as inflation remains firm and the labour market shows some recovery.

– Canadian Grain Commission to use surplus to avoid fee increases… The Canadian Grain Commission says it will continue to use its surplus to cover budget shortfalls and avoid potential fee increases until 2028. Expressing the CGC s commitment to being part of the success and sustainability of Canadian agriculture, Chief Commissioner David Hunt said, we recognize the grain sector is going through a period of economic stress and want to do our part to keep costs down while ensuring we continue to deliver results to producers and industry.

The CGC has used accumulated surplus funds to manage the growing gap between lower-than-projected revenue and increasing costs since 2021. Successive years of surplus draw are projected to reduce the available balance from $156 million in 2021 to approximately $57 million by March 31, 2028.

Outside Markets

The Dow Jones Industrial Average rallied up 337.47 points on Monday to settle at 47,544.59, while the S&P 500 gained 83.47 points to 6,875.16. Early Tuesday, the December Dow Jones Futures are up 306 points.

US stock index futures are still trending higher to start this morning, though European and Asian stock market are mixed to lower. Traders are nervous as US President Donald Trump roams around Asian this week hoping for signals of a thaw in global trade tensions of Trump s own making, but wary/fearing an incident from the mercurial president. It s a literal bull in the China shop.

Wall Street futures are higher this morning after all three major US indexes rallied to fresh closing highs yesterday on trade optimism and ideas the Fed will cut US interest rates tis week. Canada s TSX stock index futures ended in negative territory yesterday as commodity prices slid.

The December US Dollar Index is up 0.137 at 98.700. The Canadian dollar weakened against its US counterpart…currently quoted at 71.49 US cents.

Dec crude oil futures are down $0.82 at US $60.49/barrel. Oil prices are weaker this morning, marking their third day of declines as an OPEC+ plan to raise output outweighed optimism about a potential US-China trade deal. OPEC is leaning towards a modest output boost in December, sources familiar with the talks said, as they push on with monthly increases aimed at clawing back market share.

Grain Markets

Chicago soybean futures this morning are adding to Monday s strong rally result with further 10 cent/bu gains posted this morning. Bean futures rallied 22 to 25 cents higher across most contracts on Monday following better trade news from the weekend. Soymeal futures are up $4 to $5/ton this morning, building on Monday s $4 to $6/ton gains. But soyoil futures are down 34 to 42 points this morning, reversing yesterday s 29 to 54 point gains.

Monday morning s US export inspections report showed a total of 1.061 MMT of soybeans shipped in the week ended Oct 26. That was 33.3% below the week prior and down 59.7% from the same week last year. The US marketing year total is now 6.715 MMT of soybeans shipped since Sept 1, which is now 36.9% below the same period last year. China remains out of the US market.

US and Chinese negotiators reportedly had constructive discussions over the weekend in Malaysia, coming out with a framework for President Trump and China s President Xi to discuss this Thursday. On Sunday, Secretary Bessent stated China would begin purchasing substantial amounts of US soybeans.

Be aware though…while the media headlines suggest a trade agreement was imminent, traders have seen this type of trade talk collapse before.

China, the world s biggest soy importer, has shunned soybeans from the autumn US harvest and shifted purchases to South American suppliers due to the trade conflict with Washington. The dispute has so far robbed US soy farmers of by far their largest export market.

Lots of hype is now built into trade deal expectations…Trump better deliver something real rather than fluff. The soy market needs details on any US-China deal. If the deal falls through, a big sell-off in soybeans is more of a probability than a possibility.

IMHO…I would be using this week s so far hype-driven rebound rally to price another increment of cash soybeans. Who knows what Thursday s Trump-Xi meeting will deliver. The Jan soybean contract has leapt to a new high for the calendar year this week on is trade deal speculation. So big trade deal results are already priced into the market.

Chicago corn futures are edging 1 to 2 cents higher this morning. The corn market posted 5 to 8 cent gains across most contracts on Monday…drawing spillover support from the sudden soybean rally. Dec corn is up 2.75 cents this morning at $4.31/bu, attempting a move above chart resistance at $4.30, which would be a bullish technical development.

US export Inspections data showed 1.187 MMT of corn shipped in the week that ended Oct 23, which was a drop of 10.38% from the week prior, but 38.11% above the same week last year. US marketing year shipments as of Sept 1 have totaled 10.533 MMT, a 57.83% increase yr/yr.

US wheat markets are working higher again this morning…winter wheats trending 5 to 6 cents higher, while Minnie spring wheat is up 4 to 6 cents. The US wheat complex rallied on Monday…SRW wheat jumped 13 to 14 cents higher, HRW futures posted gains of 12 to 14 cents, while spring wheat futures were up 3 to 5 cents across most contracts.

Minnie Dec spring wheat futures are up 4.5 cents this morning at $5.65/bu, breaking above its 20-day moving average last week and now testing its 50-day average ($5.67). Along with a strengthening Prairie cash basis…suggestive of solid commercial demand…spring wheat is building on the momentum displayed last week. Perhaps the four month bear market in spring wheat is finally coming to an end?

But any sustained upside for wheat pricing will continue to be limited by the rising global supply. That includes what seems to be larger production in Argentina and Australia, with the trade also watching winter wheat planting and development weather in the US, Europe, Russia, and Ukraine.

CANADIAN GRAIN MARKET

ICE canola futures posted just modest advances on Monday, even as the Chicago soy complex rallied strongly reports of a framework for a new US-China trade deal.

Following weekend meetings between US and Chinese officials in Malaysia, US Treasury Secretary Scott Bessent said Sunday that China will make substantial purchases of US soybeans. The news helped to power soybean futures to new four-month highs in Monday s trade, with soyoil and meal also rising. However, the details of any potential deal remain uncertain, with US President Donald Trump to meet with Chinese President Xi Jinping at the APEC Summit in South Korea later this week.

Canadian Prime Minister Mark Carney is also expected to meet with Xi at the APEC Summit, with Canadian canola seed, meal and oil still subject to prohibitive Chinese tariffs.

January canola added $1.50 yesterday to finish at $634/tonne, while March was up 70 cents at $645.90.

For today… canola futures are moving around $1/tonne higher this morning…helped by the bullish tone this week for CBOT soybeans. But soyoil and palm oil are weaker, as are EU rapeseed futures…so that is limiting canola gains. Still…with Jan canola up only a modest $0.50 this morning at $634.50/tonne, a steady basing process this month is developing on the price chart.

Dramatic upward price action in soybeans is entirely driven by the possibility that China and the US will come to a trade agreement this week on the sidelines of the APEC summit in South Korea. But no details yet…and if results underwhelm, the bean rally could quickly erode away. So there s that.

Also, while results are now expected, there is some hope in canola circles that Prime Minister Mark Carney (who is also at the APEC Summit) and meeting with China s President Xi, might make some progress on our trouble canola trade front.

So far this new crop marketing year, Canadian canola exports continue at a pace that is less than required to hit the targeted 7 MMT. This is the minimum level of exports needed to leave a reasonable level of stocks at the end of the crop year. In the week ending on Oct 19, canola exports were only 124,000 tonnes. Canola export shipments are now a disappointing 1.079 MMT since August 1, behind last year’s pace and the lowest level to Oct 19 in over seven years.

Pea Market Stalled

Canada produced a very large total field pea crop of 3.563 MMT in 2025, and another 900,000 tonnes from US growers. But there are problems on the demand side of the ledger, with Canadian exports currently blocked from moving into China. India has been a buyer, but not at the pace needed relative to abundant supply. Priced have slipped by $60 to $70/tonne into India.

Meanwhile, Russia has emerged as a player on the export front for edible peas. Russia has the advantage of tariff-free access to both China or India, whereas Canada can go to India or Europe…locked out of China by 100% import tariffs (retaliation for Canada s 100% tariffs on Chinese electric vehicles).

Since the China tariffs took effect, yellow pea prices here have dropped 43% and green peas by about 50%. Prairie yellow pea cash bids currently range between $7.40 to $7.85/bu…best prices further to the West. While the federal government is working through diplomatic channels, including meetings and trade missions, there is a need for urgency with much of the 2025 as of yet unsold.

If Canada remains shut out of the Chinese market too long, buyers there could permanently shift to other suppliers.

The presence of Russia is shifting trade flows. And this year, we need to curtail supply. To do that, market price may need to drop below replacement value, which means farmer, unfortunately, have to lose out.