Farmers could be forgiven if it felt like Groundhog Day as market experts unpacked the state of 2026 global grain markets at the SouthWest Agricultural Conference.
Ben Buckner, chief grains analyst with AgResource Company, notes that market conditions really haven't changed since his last visit to the conference a year ago.
In this market report, Buckner opens with a theme that will sound familiar to many farmers and marketers: global supplies remain ample, particularly for corn, soybeans and wheat, and that abundance is suppressing any meaningful price recovery. “There’s not much behind the curtain with respect to supply,” he says, noting trend yields are above average in both hemispheres.
Buckner points to biofuels as a potential demand catalyst, noting that increased blend rates — like those implemented in Brazil — have helped absorb surplus. However, in North America, progress toward higher biofuel consumption remains a policy challenge rather than a quick fix.
Looking at global drivers, Buckner says demographic shifts — including updated IMF projections showing a deeper population decline in China — dampen long-term food consumption growth. He contrasts this with India’s expanding, more self-sufficient agricultural economy, which could temper India’s net import demand in the near term.
Weather trends, including a relatively benign La Niña in South America and normal climate patterns anticipated for 2026, suggest no immediate supply shocks, Buckner said. And while geopolitical turmoil continually reshapes trade flows, he noted its rapid unpredictability limits traders’ ability to plan around it.
For farmers navigating these markets, Buckner is pragmatic: be prepared for extended periods of low prices, similar to the last 12 months, unless significant biofuel policy shifts occur or a major weather threat emerges. He also pointed to seasonal demand increases through spring as potential windows for tactical risk management.
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Welcome to real agriculture. Bernard Tobin here at the Southwest Agricultural Conference. We're at the Ridgetown campus, University of Guelph, going to talk markets now with Ag Resource chief greens analyst Ben Buckner. Ben, how's it going?
It's on pretty well, sir. My third year here. Always a pleasure.
Yeah, I know. And we've talked, I think, every year, and, you know, I'm looking for different conversations, but in this market that we're in, we kind of. It's kind of like Groundhog Day. We're having similar conversations. And I guess I want to wander through, you know, some of the dynamics of the market and then maybe talk about specific questions, crops. But I guess let's start with supply. I mean, you started your presentation today with saying, hey, there was so much supply, especially on the corn side of things, that it's difficult to change things right now.
Yeah, that's right. There's not much behind the curtain with respect to supply. I think no secrets. You know, Mother Nature was pretty kind or mostly kind to almost every place on Earth and certainly both hemispheres. So really go through the list of weed exporters, corn exporters, soybean exporters, trend yields are above kind of across the board. And so that just the math adds a lot of supply to the balance sheet.
What about demand drivers here? Obviously, the other side of the coin here, demand, it's become the big challenge. And, you know, you talked about, you know, a number of things starting maybe, you know, with biofuel policy.
Yeah, yeah. So here we are again, too. I think, you know, we've. We've gone through this cycle before where prices are very high, we produce a lot, demand gets destroyed. And so we looking for outlets for everything that we produce in 2020-25 and probably 2020-26. So I guess we're thinking about how is the best way to kind of expand consumption of things. And I think it is biofuels. We've seen this happen in Brazil. They've got a lot of product, of course, kind of a new behemoth in the world of agriculture. So they just raised biofuel blend rates, encouraging corn produced for ethanol, soybean oil, and biodiesel. And so that's kind of how they're managing this. And so I think we need the same thing in North America from the developed world as a Whole, it takes political willpower, of course, but it is, I think, a low hanging fruit. If we could get it done now.
A simple thing would have this larger oil seed crush, but that is not such a simple sort of plan.
Yeah, that's correct. You know, it takes a couple of years to get a crush plant online and we've been very active in I think North America as a whole in adding to crush capacity. But as of now, the best work that we've done is in calendar year 2026. So US soybean crush will be, you know, 2.6 billion bushels. So higher. A record, but you're only adding 75, 100 million bushels per year. Does that offset the challenges we've seen elsewhere? And this is going to be a slow process. So it is kind of capacity constraints is what hinders that.
You talked as well about China and we're going to talk a lot about China here as we go forward. But one thing you started with was the population decline and that demand and the impact there.
Yeah, it's been kind of a feature, I think of this particular, the conference that we attend. And we can see this coming, you know, population slowing, ultimately contracting in China. I guess what we've highlighted too is that every update we get from the International Monetary Fund, for example, it always accelerates and intensifies this contraction. So a year ago at the conference we thought that between 2024, 2028, China would lose about 7 million people. The new update in that Same period is 13.5 million people. So just thinking about the reality of food consumption, food disappearing from the world market, you know, it's not a positive thing to have the driver of food consumption losing people eating.
Yeah. And you've got another dynamic playing out in India.
Yeah, so we've got India kind of surpassing China and the global population. They're now the most populated country where per incomes are growing, they're eating more food. I think the issue that we've got when we think about India and China is India's more self sufficient in food production and really has government policy designed to take care of their farming community. So I think eventually China or India is going to import a lot of stuff, but the next couple of years India is probably going to fight that by increasing farm incomes, encouraging production, things like that.
You also talked about the fact, I mean there's no glaring threats. And part of that conversation was about the weather, you know, El Nina, La Nina. I mean those, those are going to be kind of absent from an impact perspective potentially in 2026.
Yeah. So far, you know, it's the Southern hemisphere is where we're focused on, so we've already got almost in the bag. Completely record combined wheat production in Argentina and Australia. So they avoided threats. I think the big surprise so far this season two has been La Nina is present today, but it's had no negative impact on Argentina, which is rare. So most likely, given Brazil is going to start harvesting soybeans in bulk starting next week, probably we'll avoid South American weather threats. And then we've got, like you mentioned, starting at the very top, probably neither La Nina nor El Nino in calendar year 2026. So for the most part, I think we just have to assume without major ocean temperature deviations, normal climate patterns, that's at least going to be the starting point for us.
You didn't get a lot into it today, but geopolitical turmoil playing such a big part of this, but, you know, not something that, you know, traders can really do a lot about. Sure.
And it changes so rapidly. You know, I've been in meetings where the sort of presenter from Washington would present. Here's our best guess on how foreign policy in the United States works for the next couple of months. And then 30 minutes later that slide deck is outdated because something has changed. But I think that's something we'll have to contend with moving forward. And our biggest focus too has been on, like, trade flows. Yeah. As China increasingly leave the sort of Canada and the United States as suppliers of food, they move elsewhere. And so it's. That is, I think, rooted in here and that's the trade flow issue is what we've got to deal with.
And you mentioned this is a strategy that China's been working on for almost 20 years. I mean, moving, you know, away from North American supplies and really get. Putting themselves in a position that. To play the top catcher.
Yeah. And I think we've kind of seen that play out, you know, the, the negotiations, the resolution to this war hasn't been seamless or as quick as it was 2018, 2019. And yeah, so they're moving into sub Saharan Africa, moving into South America, making inroads into these other food suppliers to kind of avoid what probably will be ongoing terminal turmoil between the kind of developed world and China. And so they're prepared for that.
Yeah, let's, let's talk about corn, obviously, going back to that large supply and what American farmers are going to do this year. You have got your eyes focused on Brazil these days in South America and what role that's going to play at different times in the year.
Yeah, I think so. So first the next crop up is the Argentine corn harvest. That will start technically probably the last days of February. I think that crop will be very big. They just avoided weather issues and so that's coming at us. After that, I think we move pretty quickly to Brazil. Does it rain in Brazil in the month of April or does it not? That's next. But, but we are carrying over a lot of feed products into a 2026 crop year and that gives us, I think, a buffer against, you know, at least some minor supply issues.
Let's have a quick look at wheat. You know, you talked about it being an anchor on corn and in many perspectives, you know, it's being priced as a feed grain.
Yeah, sure. I think the wheat market more than other principal market especially is actively finding demand. You know, Argentine wheat today is priced below US corn and Canadian corn and really price below the corn market in Argentina. So they've decided they've got too much. It's got to be a feed product. You're also seeing markets kind of worldwide encouraging fewer planted area in wheat across the world. So it's starting that process. But the wheat market is trying to encourage demand, curtail future production and that's why we are where we.
You also talk about that, that that competition for demand is based. I mean there's, there's very little demand out there, but that competition is. So to attract it is playing a big part here.
Yeah, we've got a lot of wheat, we've got a lot of corn, we've got a lot of sorghum, we've got a lot of high protein wheat that's pricing itself as a feed grain. So that's been kind of the message here is will there be big picture changes in the markets? You know, the markets will move, of course, but I think we've just got a lot of physical grain supply and that kind of obstructs lasting recoveries.
Yeah, and on that note, I mean, you basically said, you know, I think farmers have to be prepared, you know, to be in that $4 corn, you.
Know, 12, 24 months until the next threat. I think that's the biggest issue. And maybe it's something geopolitically or maybe it's weather, but. And I don't know if we can really be bearish of grain here, but we just want to prepare people to, you know, will rallies in the market be lasting. And increasingly all the work we do, it's got to come down to a Weather threat.
Yeah. Let's talk about soybean production and, you know, what's, what's happening in Brazil and you say, you know, when we see demand, Brazil is ready to rush in and supply it. So, I mean, at that, with that dynamic, I mean, how do we, how do we change things moving forward?
I think it's got to be a weather threat or our biggest concern long term is, you know what, at what price do we kind of discourage Brazilian acreage expansion, which has been ongoing for the last decade and even happened last year despite pretty thin margins. And this year, again, I think since the growing season in a lot of places in Brazil is almost over, we didn't build any weather threat. So it's going to be a very large Brazilian soybean crop. So it's probably not until the Northern hemisphere growing season starts that we can kind of start to fine tune or lower oil seed supplies when it comes to soybeans.
How do you factor in the Chinese question, the Chinese demand? I mean, what. It looks like we're going to meet that 12 million metric tonnes. There's a commitment for 25, 25, 25 next three years. Where does that fit? Is it enough? It's.
I don't think it's enough if you assume normal weather. So even 25 million tonnes would be the lowest Chinese soybean imports from the US outside of this year since 2019. So it doesn't reflect any growth and we're not seeing a lot of growth in China's imports from everywhere. So something seems to be stagnating with respect to the world's largest soybean consumer.
Yeah. So bottom line here, we're kind of stuck here. So I was going to ask you some thoughts on, you know, what farmers can do, what maybe the administration of the United States could do. I mean, you mentioned, you know, E20, E30 could be done if you wanted to do it.
There's not a physical reason why we couldn't do E15 even, and that would add, I think, something like 500 million bushels to US corn demand, which would certainly impact the Ontario market as well. There's no reason we can't sort of implement more comprehensive credits to expand biodiesel, renewable diesel production. So I think biofuel policy is the way to go here. Can you get that done? Is the big question. So our message to farmers is, unless that happens, or unless there is a drought somewhere, ideally somewhere outside of North America, just kind of be prepared for the next 12 months to look like the last 12, there will be periodic opportunities. But just don't get caught up in big picture market changes unless you see biofuel policy or pretty substantial adverse weather.
Where might those pops or those opportunities be from your perspective?
I think seasonally we'll be using more grain in North America and so we'll have less of it in the physical market. So we tend to top markets like corn and soybean sometime between really February and May. Generally it's April and May, so I think that's going to keep the market fairly sensitive. And you can't rule out rallies weekly or monthly of 4, 7, 8%. I think that's totally reasonable. But I think until we get to the early part of summer, we would like to be pretty active and thinking about risk for the crop this year and maybe also next year, the year after that. So leverage recoveries with sales. Pass that risk off on someone else.
Well, Ben, it's great to have you back on the show this year. AgResource, a great resource for farmers and grain traders. Thank you so much for stopping by. I guess we'll have a different conversation next year.
I hope so.
