THE WATCHLIST:
Mind the ‘bean gap?
The lingering dry season in Brazil raises the risk of planting delays and a later gap in soybean exports.
AUSTRALIA
Australia’s winter crop prospects remain strong, but some of the west could use some rain.
WORLD
WHEAT
The big watch on Black Sea wheat is halved. South-east Europe into western Ukraine are likely get more rain this week. Forecasters expect rain from eastern Ukraine into southern Russia. Whether that rain is enough to alleviate dryness is uncertain. We do not think this ‘watch’ was having much impact on prices, so any ‘unwind’ is likely modest at most.
COARSE GRAIN
Coarse grain has a minor worry in Argentina, but it is too small and too early to influence markets.
OILSEEDS
A large chunk of Brazil’s soybean regions remains a watch. Forecasters expect some rainfall in the watch region, but it is unlikely to be enough. There is still plenty of time for rainfall to accumulate, so crop worries are not imminent. However, the prospect of planting delays can potentially influence markets. Analysts were already wondering whether China can get by in the gap between old-crop and new-crop South American soybeans. Delayed planting, and so likely delayed harvesting, would affect those calculations.
Southern Winter Crops
Australia’s winter crop regions will mostly continue to have enough soil moisture. Western Australia’s crops further inland could use some rain. Forecasts and projections offer a mixed picture on whether that will occur. Elsewhere, some southern interior crops are likely losing some yield. Some crops here have little to no moisture and temperatures are rising. Crop estimates are likely stable for now.
Argentina’s winter crop regions mostly have adequate or better soil moisture. Crops are reportedly developing very well, resulting in expectations for large crops.
Brazil’s winter crop harvesting has begun. Harvesting and maturing will have to work around rain and, in some places, soggy ground. Crops that are still developing have abundant soil moisture. Crops are very likely to be large.
Southern Summer Crops
Southern summer crop planting is quickening. A La Niña context remains the consensus but it does seem to developing more slowly than expected. So, The Watchlist will continue to err on the side of caution, lowering the threshold to applying a ‘watch’.
Australia’s summer crop regions are mostly dry. And weather forecasters do not expect that to change for another week or so. The context for dryland crop planting is poor. However, this early in the season, there remains time for moisture to accumulate. A slower start to the forecast La Niña event reduces confidence about a turnaround.
Argentina‘s growers are planting corn apace. Most corn regions have good or better soil moisture. Weather forecasters expect enough rain in those regions to maintain or raise soil moisture. The exception is in some western and northern regions, that remain dry. Forecasters expect some rain here, but whether that will raise soil moisture enough is uncertain. So, these regions remain a ‘watch’. The overall picture suggests normal or better corn crops in Argentina.
Brazil’s soybean regions remain mixed. In the south, moisture is abundant, providing an excellent planting context. The centre-west and centre-east are though remain very dry. Forecasters expect that dryness to persist this week. Forecasts for the week beyond contain more rain. Those forecasts are important because the dry regions produce a very large share of Brazil’s soybeans. Plenty of time remains for rain to fall, so crop forecasts are not under threat. However, delays to soybean planting would likely have some market impact. Later soybean harvests in Brazil would have consequences for China’s imports and, possibly, US exports.
Northern Winter Crops
Growers are now well into planting their 2026 northern winter crops. Two existing watches remain. The most important, the ring around the Black Sea, changes substantially. The other, White Winter wheat regions in the US north-west, is unchanged.
Black Sea ‘watch’ ring has been cut in half. The western half, from the Europe’s south-east into western Ukraine, saw a surprising amount of rain last week. Forecasters expect more rain here this week. That western half is thus ‘unwatched’. The eastern half is dry now but forecasters expect some rain here over the next week or so. Whether that rain is enough is unclear, so the ‘watch’ remains – for now. The forecasts look like a seasonably wetter pattern has begun. The watch has likely had little influence on prices to date, so there is likely no ‘unwind’ either.
Some US White Winter wheat regions got a little rain last week. Forecasters expect a little more this week in similar places. Much of the region, however, was and will be missed by those rain events so justify a ‘watch’. We have maintained the region-wide ‘watch’ because the rainfall is unlikely to be enough to replenish irrigation reservoirs. The crop threat is modest for now. And the region produces a modest (15-20%) share of US wheat. Together, that means the issue will likely have little market impact for now.
Northern Summer Crops
Ukraine and Russia’s summer crops are now being harvested with little weather interruption.
In the United States, summer crop yields do not face any new widespread threats. Weather forecasters expect conditions that will mostly support crop maturing and harvesting. Last week’s potential threat from Hurricane Humberto to some of the US south-east was not realised.
Corn crop losses in parts of Europe are now set for the season.
Canada’s Prairies are now reaching the late stages of harvesting. Weather forecasters expect some potential interruptions that are unlikely to persist.
