Paris rapeseed values closed lower overnight. The Feb and May 2026 slots shed €4.75 / tonne. Winnipeg saw double digit losses, falling CAD$15.60 / tonne in the January slot, and finding no support across outer months, the Jan 2027 contract also falling CAD$11.40 / tonne.
Weakness in both Chicago soybean futures and Malay palm oil futures didn’t help, but the main pressure on canola came from speculation that StatsCanada will increase the Canadian production estimate again in a report due out tonight. Private estimates are suggesting that the current estimate of 20.03mt could be increased to as much as 22.1mt. The average trade estimate coming in at 21.25mt.
If Canadian production is increased to 22+mt, combined with a recent increase in Australian production to 7.2mt, we could see the stocks to use ratio for canola jump to over 16%. The highest S:U ratio we’ve seen in some time, this will weigh on prices longer term unless we see an increase in either international crush demand or Chinese imports. Even so, world ending stocks are likely to come in about 13mt, well above last years number of 9.85mt.

The combination of softer US futures and a stronger AUD will not help us negotiate higher bids today. Although sharply higher against the US dollar and Asian currencies, including the Indian rupee, the AUD did not move strongly against the Euro or pound. In fact it fell slightly against the pound. Is it time to book that trip to Japan, at 102.39Y/AUD, it’s probably the best exchange to the Yen I’ve seen.
Is the move in the AUD technical, is it just a sideways USD that’s lacking fuel to burn. The Australian economy is still in the toilet, there are no fundamental reasons to see a stronger AUD. The usual Q4 improvements are making things look a little better than they are, housing prices are still keeping someone’s dream alive. As usual the AUD will continue to be a proxy for the Yuan and China isn’t setting the world on fire with much of their economy stagnating or shrinking once you get away from government controlled firms and into the private sector.

Local trade was mainly focused on milling wheat yesterday. Trade shorts for APH2 into the Brisbane port zone have blown out the spread to H2 up there. Brisbane APH2 bid $390 versus H2 at $367, a $23 spread. This compares to the Newcastle port zone that is bid $365 for H2 and $375 for APH2.
It’s always good to try and compare international values to these kind of domestic price discrepancies to see if it is trade shorts in the Brisbane market that is widening the spread, or if it’s simply opportunistic trade in the Newcastle zone narrowing the grade spread.
US dark northern spring wheat and Canadian spring wheat are the two wheat grades that will work against APH into the Asian market, although APH2 is a very specific type of wheat for a very specific product. The US DNS value out of the Pacific Northwest is valued at about US$251 FOB, that’s roughly equivalent to US$280 C&F Japan. Canadian spring wheat is roughly US$1.80/t more expensive than US DNS wheat. If we convert the US DNS C&F Japan value back to an equivalent Newcastle port price, we come up with a number close to AUD$382. So it appears that Brisbane value is indeed a little over DNS values, while Newcastle is a little under. Neither are reflecting a significant white wheat premium though.

The feed barley market is finding plenty of local supply at present. Farmers are selling harvested barley, not confident that prices will improve in the new year. There is a supply of SFW1 on the LPP this year too, which may see those small scale feeders using barley, switch to wheat later in the year as local supplies of barley dry up.
Canola values are likely to come under pressure today, the stronger AUD and sharply lower closes at both Winnipeg and Paris futures market hurting bids.

The high cell that has produced cool mornings and mild days this week will move off the coast of NSW this morning. As the high moves further east it will begin to produce warmer N-NW airflow across the inland. Daytime temperatures are expected to rise sharply between today and Saturday. Thursday 34C, Friday 36C and Saturday 39C. Winds may also pickup on Saturday afternoon, gusting to 30kmph across the plains.

Winds may become stronger as a weak change moves across the plains late Saturday or Sunday morning. The change in temperature will be significant, possibly dropping by 10C as the change moves through. Dubbo for instance is forecast to see 40C on Saturday and 30C on Sunday.
There’s a good chance shower will develop overnight Saturday, pushing onto the LPP from the SW around midnight, tracking NE.

The more active storms are expected to be to our east along the ranges east of Nowendoc and towards the coast and Port Macquarie from late in the morning Sunday and into the afternoon.
There’s a good chance we will see some clearing storms or showers develop on Sunday afternoon, but volume is expected to be minimal on the plains.

The outlook for next week is warm to hot with the chance of a storm developing on Wednesday.