Agriculture Market Update: Wheat Futures Drop with New Australian Forecast

1. Wheat Futures Drop as Australia Raises Forecast

Wheat futures fell overnight, following Australia’s increased forecast for its wheat production. The latest report from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) estimates that wheat production will rise to 35.6 million metric tons for the 2025/2026 marketing year, up from a previous estimate of 33.8 million tons.

This adjustment represents a 4% year-over-year increase and is 29% above the 10-year average, the agency reported. The USDA had previously predicted Australian wheat output at approximately 36 million metric tons.

Notably, production in Western Australia is expected to increase by 6% annually, positioning it as the second-largest crop on record. Additionally, crops in South Australia and Victoria are projected to recover significantly from previous drought conditions.

While soybean futures witnessed a rise, attributed to demand signals from China — which recently purchased 312,000 metric tons from U.S. suppliers — wheat futures saw a downturn. For March delivery, wheat futures dropped by 3¢ to $5.32 per bushel on the Chicago Board of Trade, while Kansas City futures decreased by 4¢ to $5.22¾ per bushel.

Conversely, corn futures slightly increased by 1¼¢ to $4.46¼ per bushel, and January soybean futures grew by 5½¢ to $11.34½ per bushel.

2. Corn Inspections for Export Decline

According to the USDA, inspections of corn intended for offshore delivery dropped week over week. For the week ending November 27, corn inspections totaled 1.42 million metric tons, down from 1.7 million tons the previous week, but still ahead of the 948,812 tons inspected during the same week last year.

In contrast, soybean inspections saw an increase, rising to 920,194 metric tons from 808,470 tons the week prior. However, this figure remains significantly below the 2.11 million tons assessed at the same point last year.

Wheat inspections also reported a decrease, falling to 384,881 metric tons from the prior week’s 480,429 tons, yet still surpassing last year’s figures of 298,623 tons for the same week.

Since the marketing year began on September 1, corn inspections reached just under 19 million metric tons, up from 11.1 million tons during the same period last year. Conversely, soybean inspections now stand at 11.9 million metric tons, down from 21.8 million tons a year earlier, largely due to a delay in Chinese purchases until a recent trade agreement was finalized.

3. Winter Weather Conditions Persist in Indiana and Ohio

The National Weather Service has issued winter weather advisories extending from Indiana to the Atlantic Ocean. Although snowfall in Indiana is forecasted to lessen, roads may remain slick and hazardous.

Central Ohio is predicted to receive an additional 2 inches of snow, with the heaviest snowfall expected to taper off by 7 a.m. local time. Travelers have been warned to expect poor visibility and slippery conditions, advising caution on the roads.