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WEDNESDAY 03.11.26
Canola rebounded nicely after Tuesday’s head fake. May futures are trying to climb back toward the contract high at $767/T, and November futures are back to testing the June 2025 high at $730/T. Markets are overbought but seem hesitant to break stride amid the upside momentum. Tread cautiously here, as there is a significant buildup of momentum driven by war & oil uncertainty. Our risk-balancing recommendations are in place, and I am now comfortable holding off on additional sales to see if the contract highs can be reached or surpassed.
Wheat futures were trying to print some buy signals on the daily charts today. There are some harami’s, not perfect ones, but better than seeing the market fall off another .10/bu on Wednesday. If these signals are confirmed with some follow-through strength, we will be able to hold off for an additional ~.50/bu upside on Minneapolis & Kansas wheat as the next sales checkpoint. Just like with canola, our risk recs are in place, and we can now hold off to see how far this war/oil volatility pushes prices up.
One big negative is watching the basis deteriorate as fuel prices rise. Oil continues to reach toward all-time highs, shipping routes remain strained, and farmer deliveries continue on this nice jump in the market. These three factors are reflected in the basis and are the driving force behind their widening (getting worse). I expect that will continue in the short-term until some of these events change.
May soybean futures are back-and-forth, holding above $12/bu. We are waiting for a move above $12.33/bu to confirm further upside, or a break below $11.77/bu to confirm timing for the next sales of the 2025 & 2026 crop. May corn has held up along the trendline and is making way back up to the resistance range at $4.65-4.75/bu. We will take our cue from market activity in that range. Any breakthrough can confirm up to $5/bu+, and any breakdown might result in the next rec from us.
Feed prices have ticked up marginally, following the strength in corn & wheat futures. But nothing meaningful, maybe .05-.10/bu this week. We are holding off on additional sales, with risk & cash already covered. Rye, faba beans, and durum are sitting around the same level as last week. You can use current prices on the 2025 crop to catch up if undersold on those 3, but wait for further signals to get rolling on more 2026 crop sales.
Pulse markets haven’t budged since last week. The market is hesitant about the possibility of an Indian tariff extension on lentils at the end of the month. I’m not convinced these are the highest prices we’ll see, given that El Niño is expected to come into the picture later in the year. Also, this is the seasonal lull for pulses. Let’s see how the March heat & seasonal charts unfold into April. We will showcase our new seasonal index charts in our Week Ahead report next week, so stay tuned!
US/Iran Headlines
What’s Today’s Story:
The main story right now is the Strait of Hormuz turning into the center of the conflict. Iranian forces have reportedly placed mines and threatened shipping, while the US military says it has already destroyed several Iranian mine-laying vessels in the area. The Strait handles roughly 20% of the world’s oil shipments, so even partial disruption is pushing crude, diesel, fertilizer, and freight prices higher. Tanker traffic has dropped sharply as shipping companies wait to see if naval escorts can secure the route. In other words, this war has quickly shifted from a military story to an energy and global logistics story, which is why ag markets are reacting so strongly.
How Long Will The War Last:
Right now the timeline is highly uncertain. Trump said the war could end soon and that there are “practically no targets left,” suggesting the US believes its objectives may already be close to achieved. But analysts and regional officials warn the conflict could still stretch weeks or even months if Iran continues retaliating through missile strikes, drones, or disruptions to energy shipping. Iran’s strategy appears to rely on endurance and economic disruption, hoping higher energy prices and shipping chaos pressure Western governments to back down. So while the initial strike phase may be short, the economic and geopolitical effects could last much longer.
Fuel & Fertilizer:
For fuel and fertilizer, the Strait is the main factor. ~20% of global oil and LNG trade typically moves through Hormuz, and another report noted that ~30% of the world’s urea exports also move through that route. That means a prolonged disruption would not just spike crude for a few days, it would tighten diesel, LNG, ammonia, urea, and shipping all at once. The market is not yet priced for a permanent closure, but it is clearly pricing in a significant risk premium while mines, escorts, and vessel security remain unresolved.
Strait Of Hormuz:
This is no longer just talk. Reports say that Iran has laid roughly a dozen mines in the Strait, the US says it destroyed multiple Iranian mine-laying vessels, and commercial shipping is still facing major uncertainty, even though at least one Saudi oil cargo moved through. Another news article said the closure has already forced major Gulf producers like Saudi Arabia, Iraq, and Kuwait to cut production because storage is filling up without enough tanker movement. So the market is treating the Strait as an active supply-chain problem, not a hypothetical one anymore.
Crop Effects:
From a crop condition perspective, the war is much more an energy and logistics story than a direct crop loss story. USDA’s latest bulletin said dry and warm weather in Iraq and Iran was actually accelerating winter crop green-up and vegetative development, not causing fresh widespread damage right now. So at this point, I would call the crop effect negligible compared to the fuel, freight, and fertilizer effects.
Fuel Shortage Affects Fieldwork:
Folks have been asking if Australia's fuel shortages are affecting their planting. I wasn’t able to get confirmed numbers online, but I will continue researching. There is some truth to fuel worries affecting fieldwork, but the more recent example is Brazil rather than Australia. News articles suggest that Brazilian farmers are seeing a jump in diesel costs and supply tightness right in the middle of the soybean harvest and corn planting, which matters because Brazil imports around 30% of its diesel. That does not automatically mean widespread field shutdowns, but it does mean higher operating costs and a greater chance of localized delays if supply stays tight.
US/Iran Headlines
What’s Today’s Story:
The main story right now is the Strait of Hormuz turning into the center of the conflict. Iranian forces have reportedly placed mines and threatened shipping, while the US military says it has already destroyed several Iranian mine-laying vessels in the area. The Strait handles roughly 20% of the world’s oil shipments, so even partial disruption is pushing crude, diesel, fertilizer, and freight prices higher. Tanker traffic has dropped sharply as shipping companies wait to see if naval escorts can secure the route. In other words, this war has quickly shifted from a military story to an energy and global logistics story, which is why ag markets are reacting so strongly.
How Long Will The War Last:
Right now the timeline is highly uncertain. Trump said the war could end soon and that there are “practically no targets left,” suggesting the US believes its objectives may already be close to achieved. But analysts and regional officials warn the conflict could still stretch weeks or even months if Iran continues retaliating through missile strikes, drones, or disruptions to energy shipping. Iran’s strategy appears to rely on endurance and economic disruption, hoping higher energy prices and shipping chaos pressure Western governments to back down. So while the initial strike phase may be short, the economic and geopolitical effects could last much longer.
Fuel & Fertilizer:
For fuel and fertilizer, the Strait is the main factor. ~20% of global oil and LNG trade typically moves through Hormuz, and another report noted that ~30% of the world’s urea exports also move through that route. That means a prolonged disruption would not just spike crude for a few days, it would tighten diesel, LNG, ammonia, urea, and shipping all at once. The market is not yet priced for a permanent closure, but it is clearly pricing in a significant risk premium while mines, escorts, and vessel security remain unresolved.
Strait Of Hormuz:
This is no longer just talk. Reports say that Iran has laid roughly a dozen mines in the Strait, the US says it destroyed multiple Iranian mine-laying vessels, and commercial shipping is still facing major uncertainty, even though at least one Saudi oil cargo moved through. Another news article said the closure has already forced major Gulf producers like Saudi Arabia, Iraq, and Kuwait to cut production because storage is filling up without enough tanker movement. So the market is treating the Strait as an active supply-chain problem, not a hypothetical one anymore.
Crop Effects:
From a crop condition perspective, the war is much more an energy and logistics story than a direct crop loss story. USDA’s latest bulletin said dry and warm weather in Iraq and Iran was actually accelerating winter crop green-up and vegetative development, not causing fresh widespread damage right now. So at this point, I would call the crop effect negligible compared to the fuel, freight, and fertilizer effects.
Fuel Shortage Affects Fieldwork:
Folks have been asking if Australia's fuel shortages are affecting their planting. I wasn’t able to get confirmed numbers online, but I will continue researching. There is some truth to fuel worries affecting fieldwork, but the more recent example is Brazil rather than Australia. News articles suggest that Brazilian farmers are seeing a jump in diesel costs and supply tightness right in the middle of the soybean harvest and corn planting, which matters because Brazil imports around 30% of its diesel. That does not automatically mean widespread field shutdowns, but it does mean higher operating costs and a greater chance of localized delays if supply stays tight.
Some Quality News Links:
https://www.bbc.com/news/articles/c78n6p09pzno
https://boereport.com/2026/03/10/oil-could-hit-150-amid-gulf-shutdown-wood-mackenzie-says/
https://www.cnn.com/2026/03/09/economy/oil-price-shock
US Winter Wheat Conditions:
The latest US crop condition story is mixed. USDA’s monthly state stories and crop production notes still point to areas of concern in places like Nebraska, while Kansas reported winter wheat at 56% good to excellent for the week ending March 8th. That tells me the market still has a reason to watch the Plains, but there is no clear national crop scare in the latest data.
India Rabi Crop Conditions:
India is one of the more important crop-weather stories right now. The news is saying India is bracing for an unusually hot March with wheat, rapeseed, and chickpeas at risk during grain fill and maturity, and the IMD followed with a hotter-than-normal March to May outlook as well. If that heat persists, it could tighten India’s domestic pulse balance and improve the odds of stronger import demand later, which is something pulse markets will be keeping a close eye on. We need to monitor MSP values & tariff talks for signals on the direction of our pulse prices later in 2026.
Brazil Soybean Harvest:
Brazil remains a big crop soybean story, but the trade is increasingly talking about harvest costs and fuel logistics alongside production. Reports noted diesel costs have jumped during peak harvest and corn planting, and USDA’s March WASDE also raised Brazil corn output while keeping the tone bearish on South American supplies. The crop is big but logistics are becoming a bigger issue.
Argentina Soybeans:
Argentina remains more of a recovery than a perfect story. USDA’s weather bulletin said dry conditions returned across much of Argentina’s corn and soybean area, slowing the recovery that had started after recent beneficial rainfall, and March WASDE trimmed Argentina’s corn outlook because February dryness hurt yield potential. This slow trickle of changes needs to be monitored, as it can become beneficial for soybeans.
Palm Oil Crops:
Palm oil got a supportive crop update this week. MPOB data showed Malaysian palm oil stocks fell 3.94% in February to 2.7 million tonnes, while production dropped 18.5% MoM. Lower production and lower stocks are the kind of numbers that can help keep palm oil supported, and that can spill over into canola values when the global veg-oil supply gets tighter. Malaysian palm has rallied 8% so far in March.
Black Sea Winter Crops:
The Black Sea crop story is still weather plus war. March USDA raised Ukraine production, but reports say that winter port strikes and attacks have continued to hit Ukraine export capacity, while the market still remembers the late-January freeze risk. So, the crops aren’t in a bullish situation, but it is definitely not normal either, and logistics remain a real problem.
Supply & Demand
USDA Summary:
The market’s first reaction was pretty much right. This WASDE was not a major game changer. US wheat and corn balances were basically the same, but there were a few minor changes, including lower Australia wheat production, higher Argentina wheat exports, higher Brazil and Ukraine corn production, lower Argentina corn, and a small drop in world wheat ending stocks. It wasn’t a nothing report, but with Iran dominating attention, it was easy for traders to shrug and move on.
Biofuel Policy News:
There aren’t any brand new announcements this week. The key pieces to watch are the proposed 45Z rule that gives US tax credits for low-carbon fuels. Canola can qualify under this ruling as a feedstock to produce renewable diesel & SAF. Plus, EPA’s 2026-27 biofuel quota rule was sent to the White House with a final rule expected before the end of March. The market is still waiting on final numbers, but the policy direction remains positive for renewable fuel demand.
Pakistan Pulse Imports:
Let’s toss some positive notes into the mix. Pakistan is worth keeping on the radar. Fresh news this week said the country is spending roughly $1 billion annually on pulse imports, highlighting how dependent it remains on outside supply, and the news is also talking about the Hormuz situation is raising energy and shipping risk for Pakistan. That helps reinforce Pakistan as an important import-dependent pulse market.
Fuel & Fertilizer
Strait of Hormuz
The Strait of Hormuz disruption has escalated into a real shipping and energy risk story, with traffic and insurance conditions tightening quickly. If Hormuz stays highly restricted, crude and freight can jump together, which directly pressures diesel costs and can add costs to fertilizer imports and global supply chains. The key point for farmers is that even if fertilizer supply isn’t short, the delivered cost can rise on energy and logistics alone. This is a risk that needs to be monitored in the short-term. The market can handle a week or two of shipping issues, but any longer than that can send markets into panic mode (prices go up).
US/Iran Impacts
The biggest market risk that comes with US/Iran war is oil, currency, and gold. Oil is building a war-risk premium, up 10% in three days, and that tends to feed straight into diesel and transport costs, then into fertilizer production margins because nitrogen is so energy-sensitive. Even if the physical fertilizer market isn’t panicking, energy-driven price moves can happen fast, especially if buyers rush purchases. The risk is that spring needs get more expensive simply because crude and freight are higher, not because the product disappeared. It will be interesting to see if this impacts the ‘reset’ period for 2027 values come May-June.
OPEC News
OPEC+ is set to meet on April 5, 2026, and the market is still debating how quickly production can rise without capping prices. OPEC’s Monthly Oil Market Report release schedule shows the next report date as March 11th, which can move sentiment if they change demand or supply assumptions. The big question is whether geopolitics will continue to overwhelm the usual supply/demand logic. Right now, the answer is yes, it will.
Currency & Finance
BOC Rate Policy:
The next Bank of Canada rate decision is March 18. The market will be watching whether the Bank leans more toward inflation concern from energy or growth concern from trade and global uncertainty. For grain markets, that matters because any sharp move in rate expectations can feed quickly into the Canadian dollar and cash pricing. The loonie has been one of the better performing G10 currencies since the Middle East conflict began, largely tied to the strength in oil. CAD futures remain in a tight 1.5 cent range with resistance at 74-74.5 and support at 72.5-73 cents.
Livestock
JBS Beef Plant Strike Risk:
The biggest news of the week for cattle is the JBS Strike. News reported that 3,800 workers at JBS’s Greeley, Colorado, beef plant plan to strike starting March 16, and cattle deliveries have already been redirected as the company adjusts operations. In a market already dealing with historically tight cattle supplies and record beef prices, a disruption at a major plant can tighten nearby packer capacity and add another layer of volatility.
North American Cattle Supply:
The low-supply story remains intact. Reports say the US has the lowest cattle supply in 75 years, and that tightness is part of why beef prices remain elevated even before adding in labour risk or Mexican border issues.
US/Mexico Border Closure:
The US suspension on Mexican cattle imports over screwworm remains an important supply factor. The closure reduced feeder supplies available to US feedlots and keeps the domestic market tighter than it otherwise would be.
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