Sales of wheat and barley have slowed even further in the past week as dry conditions reduce grower interest in selling, and the stronger Australian dollar weighs on the export appeal of both cereals and sorghum. Northern wheat and barley has firmed to catch business from growers who are mostly full steam ahead, or even finished, on their sorghum harvests. In the south, wheat and barley prices have dropped $5-$12 per tonne in the past week on sluggish demand from export and domestic customers close to port.

The sorghum harvest is in full swing in southern Queensland and northern New South Wales, with accumulation for new-crop shipments taking place in Brisbane. Container packers on the Downs are also busy with new-crop sorghum in a prompt market which is quoted as $20/t lower this week, largely to reflect the stronger Australian dollar.

However, the March-April market has shown signs of rebounding, looking like $330/t for Downs delivery. “You can’t get slots to deliver sorghum at some sites,” one trader said. The situation is expected to be short lived, and reflects big dryland yields of 6-9t/ha from early planted crops, with the occasional crop clocking 10t/ha or more.

However, later-planted crops are likely to yield considerably less to show the effects of a mostly dry summer. “With the dry weather, growers are sitting on their white grain, which is not like sorghum that has only one path, and that’s to export.”

The stronger AUD is improving the attractiveness of imported soymeal, particularly for consumers closer to Brisbane than Newcastle, which is the north’s only large-scale canola-crushing site. Soymeal is quoted today at around $680/t ex store Brisbane, $4/t cheaper than yesterday, simply because of the dollar. Weaker soymeal values are also weighing on canola meal.

Urea to top dress cotton is currently in demand, which is providing some incentive for growers to sell a load of sorghum for delivery to the Port of Brisbane to backload with fertiliser. “Currency’s killing us at the moment,” Sunrise Commodities managing director Scott Merson said with regard to grain exporting. “The dollar at 70.9 US cents is a big problem for the sorghum grower.”

Many feedlots have extended their barley and/or wheat coverage out to April, with ongoing dry weather likely to push more cattle into feedlots. “The Darling Downs feeders are quite well covered because they were smart enough to buy when prices were relatively low at harvest, whether ex farm or out of the system,” Delta Grain Marketing general manager Mick Parry said.

Southern growers remain largely disengaged from selling wheat and barley into the cash market. “There’s not a lot of cashflow decisions being made at the moment,” Mr Parry said of the southern as well as the northern market bar sorghum, and chickpeas being sold to fill the last export hatches for now.

Some fiercely hot weather over the past week means growers have no need to think about spraying weeds, which will not germinate in these dry conditions. “There’s no shortage of grain, but what’s being made available makes it feel balanced or short at times,” Pinion Advisory broker Brad Knight said.

The low-yielding 2025-26 wheat and barley harvest in the southern half of NSW means the Griffith-Hanwood market is trading at a few dollars above where the delivered port markets say it should be, with ASW-type wheat at around $325/t. “It’s pretty quiet,” Mr Parry said. “The grower is looking at the long-range forecast, and is in an absolute heatwave.” He said growers were largely still living on harvest sales, and may carry what remains unpriced through to the new financial year starting July 1.

Storing grain or faba beans on farm can also become a drought hedge in what for most are brutally dry conditions. “It’s a little bit different in the far north of NSW, but from Walgett to Coonamble and south, they’ve only had 50mm since August last year.” If winter-crop planting is limited by lack of moisture, growers will want to hold grain for 2026-27 cashflow, and to feed to their own livestock.

“It’s normal to have a hot dry summer, but we’ve got to be careful here; growers are not going to want to sell faba beans and barley and low-quality wheat.”

Mr Parry said growers could well be holding out for rallies in US grain futures often seen once markets start to trade Northern Hemisphere new-crop conditions, “The charts look like maybe we’ve seen season lows.”

Total grains (wheat and coarse grains) output is rising faster than forecast previously. Including upgraded outlooks for maize (mainly the US, China), wheat (Argentina, Canada) and barley (Canada, Australia), the world production estimate is up by 31m t compared to late-November, at a record 2,461m. While an additional 16m t may be channelled into consumption, now seen at 2,416m, almost as much might also be added into year-end stocks, assessed at 634m (aggregate of respective local marketing years). Global trade (July/June) is now put at 446m t, 4m more than the last forecast and 5% higher y/y (year-on-year).

Wheat harvested area is expected to dip slightly in 2026/27 and assuming average yields, next year's crop is initially projected to drop by around 2% y/y. With demand seen at a new peak, global stocks are seen moderating slightly, but with aggregate inventories in the major exporters set to remain at comfortable levels.

Seen little-changed from November, world soyabean production is pegged just a touch below the prior year's peak. With a marginal increase in availabilities matched by an uprated outlook for global demand, combined end-season carryovers are predicted broadly steady from before, at an above-average 77m t (-5m). At 187m t, the forecast for trade is maintained and equates to a 1% y/y gain.

The outlook for global rice production is mostly unchanged from before, at a high of 543m t. With consumption pegged modestly lower, paired with larger carry-ins, 2025/26 end-season inventories are increased by 2m t. Expectations for trade in 2026 (Jan/Dec) are scaled back slightly, but, at 60m t (+2%), volumes would still be a record.

Weighed mainly by weakness in global soyabean and wheat export prices, the IGC Grains and Oilseeds Index (GOI) recently dipped to a three-month low.

Boosted by better yields (+5%) and area gains (+1%), the 2025/26 total grains harvest will smash all existing records, seen 6% higher y/y. As well as bumper maize and wheat outturns, barley and sorghum crops are also expected at multi-season peaks. Consumption growth of 3% is seen faster compared to normal, led by an anticipated solid rise in feeding. After three successive drawdowns, inventories could increase by 8%, potentially the fastest rate of expansion in nine years. Comparatively steep gains are foreseen in most major exporters, with cumulative carryovers placed 40% higher y/y, at 181m t. Owing to larger wheat and maize flows, trade is forecast at a larger-than-average 446m t (+5%).

At 427m t, global soyabean production is seen just a fraction below the prior year's peak and markedly above the recent norm, including a potential record Brazilian outturn. Stemming from expanded uptake across feed, food and industrial segments, world utilisation is anticipated to rise by 3% y/y to a fresh high, including gains in the three main exporters and China. While global inventories are likely to tighten, they are set to remain historically comfortable, but with major exporters' reserves well short of past highs. Trade is predicted to edge up to a fresh peak (+1%).

Global rice output in 2025/26 is forecast largely steady y/y, including a 1% increase in aggregate production in the major exporters. With food demand shaped by population growth, total use is set to reach a new peak, while stocks are projected to expand further, largely on accumulation in India. Underpinned by brisk demand from key buyers in Africa, trade in 2026 is anticipated to rise by 2% y/y.

With availabilities swelled by a heavy global harvest, courtesy of sizeable crops in major exporting countries, global lentils uptake is predicted to expand solidly in 2025/26, by 15% y/y; Asia is set to be key to the uptrend, where growing populations, increasing health awareness and firmer demand for derivative products will underpin. Tied to potentially larger shipments to South and Near East Asia, trade in 2026 is projected at 4.9m t (+14%).

Amid an overall heavy global supply outlook, the IGC GOI weakened by 4%, with losses in wheat and soyabean fob values outweighing net gains in rice, barley and maize.

The IGC GOI wheat sub-Index eased by 2% over past eight weeks. While there were mixed movements across key origins, export prices were generally anchored by ample global availabilities.

With previous strength mostly undone in recent weeks, mainly in reaction to an uprated US crop estimate, the IGC GOI maize sub-Index was only modestly higher compared to November.

The IGC GOI rice-sub-Index rose by 5% in the period since the November report, boosted mainly by flood-related harvest disruptions in Thailand and stronger local prices in Pakistan.

Including sizeable falls at southern hemisphere origins, but with US values also lower on overall bearish fundamentals, the IGC GOI soyabeans sub-Index slumped by a net 9%.