The daily change in the tariff situation makes it difficult to produce a column that will remain relevant for a week so I’ll take the opportunity to look at global weather that could affect grain markets.
Brazil is harvesting its soybean crop and has just finished planting its second corn crop.
The country produces three corn crops in a year and the second is by far the largest, accounting for about 78 per cent of production.
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China’s grain imports have slumped big-time
China purchased just over 20 million tonnes of wheat, corn, barley and sorghum last year, that is well below the 60 million tonnes purchased in 2021-22.
The crop is huge and its success or failure has a significant market impact.
For example weather problems in 2023-21 caused the second crop or “safrinha” crop to fall 20 per cent from the year before, a decline of 15.85 million tonnes.
That shortage, coupled with a surge in China’s corn imports, helped Chicago corn futures rise from about US$3.40 per bushel in the summer of 2020 to more than $7 the following summer.
The safrinha crop last year was not a disaster, but it was smaller than the year before. That, coupled with rising demand from Brazil’s ethanol industry, supported Brazil’s domestic corn price in January and February as farmers began seeding.
Local forecaster Conab predicted in March a Brazilian corn from all three seeding periods to total 122.76 million tonnes, up six per cent from last year.
Some corn-growing areas, mostly in the south, are currently dry. The La Nina that prevailed over the past year has mostly disappeared and the Southern Oscillation is moving into a neutral phase.
However, Brazil’s National Weather Service in late March forecast that April to June would be drier than normal.
So the situation needs to be monitored.
If the dry forecast comes true it would support prices but on the other hand the expectation that American farmers will increase corn acreage this spring by five per cent is a damper on prices.
Meanwhile, over in Russia, the 2025 wheat crop was forecast to be much smaller because of dry fall and winter weather.
In January forecaster SovEcon predicted the harvest this summer would be only 78.7 million tonnes, down from 82.4 million last summer. Two years ago Russia produced 91.5 million tonnes.
In January the Russian Grain Union said it feared wheat exports in 2025 would fall 28 per cent from 2024.
Recent monthly exports from Russia have been significantly lower than recent years.
Spring has arrived with much needed rain that is helping the crop as it comes out of winter dormancy, but Russia wheat watcher Andrey Sizov recently posted on X that the moisture has only changed a disastrous situation into a below average one.
Ukraine’s winter crops are said to be doing well with adequate moisture.
Staying with wheat, the American winter crop is also coming out of dormancy. The Southern Plains are drier than they were last year.
The crop in Kansas so far is in similar condition to last year but Oklahoma and Nebraska are worse. The April-June three-month rain forecast was for below normal accumulations in the western part of the three states.
The Kansas crop is 17 per cent poor to very poor, 34 per cent fair and 49 per cent good-to-excellent.
Oklahoma’s crop is 27 per cent poor to very poor, 40 per cent fair and 33 per cent good-to-excellent. But rain was expected in the state April 5-6.
In Europe the situation is almost a reversal of recent springs.
Last year it was too wet in the north and too dry in the south but this year areas close to Mediterranean have better moisture and France and Germany are having a drier spring.
But soil moisture is still OK so there is no significant problem yet.
India’s winter crops are about to be harvested.
March temperatures were hotter than normal raising worries of heat stress.
So far the government is optimistic about the wheat crop, forecasting production might top the official expectation of a record 115 million tonnes.
April is expected to be much hotter though, so we’ll see if the optimism is warranted.
In Australia wheat seeding is several weeks away yet.
At this early point forecasts are tentative, but analysts think a return to average production around 27 million to 31 million tonnes is a safe bet.
That would be down from 34.1 million in the current crop year.
There has been little rain in southern and southeastern regions and there is little soil moisture.
Western Australia has seen below normal rain in recent weeks, but the soil moisture is good.
China’s winter wheat crop, which accounts for about 95 per cent of production, has reached spring in good shape.
The U.S. Department of Agriculture attache last week forecast wheat production in 2025-26 at 142 million tonnes, up 1.5 per cent on improved yield and steady planted area. Imports were forecast at eight million tonnes, up from about six million this year but still down from 13.6 million two years ago.
