Insight Focus
Welcome to our monthly overview of the soybean, corn and wheat markets. Here, we provide a summary of key events that happened in January and provide some details on what to look out for this month.
Forward View
- Short‑term soybean prices are likely to remain firm and volatile through early 2026, before easing in Q2 as large Brazilian exports and delayed US shipments reach China.
- Corn is expected to trade within a stable USD 4.30–4.50/bushel range in early 2026, with upside limited to weather risks or renewed trade tensions.
- Short‑term wheat prices are expected to remain capped by large global stocks, with any rallies likely short‑lived unless driven by geopolitical shocks or winter‑kill risks in the Northern Hemisphere.
Soybeans
The global soybean market in January was shaped by shifting supply dynamics across major producing and consuming regions. Brazil remained the dominant force, maintaining record export momentum despite seasonal declines. Shipments fell to 3.4 million tonnes in December—2.6 million of which were destined for China—reflecting the seasonal low as old‑crop supplies tightened.
Source: Brazilian Customs Data
At the same time, Brazil’s large 2025/26 crop outlook, with production projections between 176 million and 182 million tonnes, continued to anchor expectations of abundant supply in early 2026.
In contrast, the US faced weaker competitiveness. Although China committed to purchasing 12 million tonnes of US soybeans, logistical delays meant most shipments would not arrive until early 2026. Price pressure persisted as Brazil’s FOB values fell below US Gulf prices, eroding the US export advantage gained earlier in the year.
Meanwhile, China’s domestic market tightened: lower December imports reduced crush rates, inventories declined, and authorities released reserve stocks to ease supply constraints.
Globally, overall production for 2025/26 edged slightly lower due to declines in the US and Argentina, though Brazil’s growth offset much of the reduction. Market sentiment in December reflected a blend of tightening near‑term supply in China and expectations of renewed abundance once Brazil’s new crop entered the pipeline.
Corn
The global corn market was shaped by ample supply, subdued price action and cross‑market influences—particularly from wheat. Grains were trending lower early in the period due to abundant global supply and broadly favourable weather across major producing regions, limiting upside movement for corn.
Despite this, corn prices found intermittent support from developments in related markets. Wheat led short rallies after concerns arose over potential winter kill in the US and Russia, pulling corn higher in sympathy.
China’s soybean purchasing programme also indirectly supported corn. Strong weekly US export sales and confirmation that China had met its 12‑million‑tonne US soybean purchase commitment improved sentiment across the grains complex, lifting corn modestly. Meanwhile, Brazil advanced steadily through its summer corn planting season, with progress exceeding both last year’s pace and five‑year averages—reinforcing expectations of strong upcoming supply.
While wheat markets were strongly influenced by quality concerns and bearish WASDE revisions, the impact on corn was tied largely to expectations of high global ending stocks. The January 2026 WASDE projected world corn stocks rising to 290.91 million tonnes, significantly above earlier estimates and contributing to a largely bearish tone.
Source: USDA
Wheat
The wheat market in January was characterised by abundant global supply, strong competition among exporters and persistent bearish sentiment. Large harvests in Argentina and Australia replenished global stocks, helping reverse several years of gradual decline. The December USDA WASDE placed world ending stocks at 274.87 million tonnes, with further increases expected as the final Southern Hemisphere crops were completed.
Source: USDA
These sizeable supplies kept prices subdued, reinforcing fund‑driven short positions across major exchanges. In Chicago, soft wheat prices reached contract lows not seen in more than five years, mirroring heavy short interest in both US and European futures markets.
Despite ample supply, quality considerations began to shape intra‑market dynamics. Reports from Argentina suggested yields were high but protein levels low, raising the potential for widening premiums on higher‑quality milling wheats.
Funds partially reduced shorts in Kansas hard red wheat and Paris milling wheat, hinting at a possible shift in market perception. Meanwhile, geopolitical uncertainty added layers of risk: ongoing conflict in the Black Sea, US‑China tensions and instability in the Middle East all contributed to elevated shipping and insurance costs.
