Canadian wheat prices hit six-month low following recent rally

Platts-assessed Canadian Western Red Spring 13.5% FOB Vancouver 30-45 days forward prices hit a six-month low from Feb. 19 to Feb. 27, as volatility in the broader wheat market and concerns over impending US tariffs on Canada suppressed both values and farmer market engagement.

Initially, concerns over winterkill in the US and Russia fueled a rally in the global wheat markets, as traders anticipated potential reductions in crop yields. However, this upward momentum was short-lived, with North American wheat markets plummeting halfway through the week ending on Feb. 21, driven by a combination of improving weather conditions in South America and the anticipation of steep US tariffs on Canadian exports. The wheat futures market pivoted sharply over the course of two weeks, forcing CWRS market participants to respond quickly to reassess value.

CWRS wheat prices experienced steep day-on-day declines starting Feb. 19, when they were down $5.33/mt on the day. This downtrend continued with prices plummeting to $257.12/mt on Feb. 27 – the lowest price observed since August 2024 during the Canadian rail strike. Compared to February of last year, average monthly prices are down about 8%.

The swift decline in prices diminished Canadian wheat farmer engagement in the market, with many already having preemptively off-loaded significant volumes of their product earlier in the month, following the initial announcement on tariffs. Farmers are adopting a wait-and-see approach, holding back on further sales until they receive higher offers. "Farmers are not engaging," remarked one CWRS trader. "They won't engage unless they're paid a higher basis."

Additionally, limited capacity for April and May among grain traders, along with reportedly decreased demand, has also contributed to CWRS market uncertainty, making value difficult to confirm.

Overall, current market conditions and anticipated tariffs have left many producers hesitant to sell. With planting season right around the corner, Canadian wheat farmers will continue to assess their strategies, waiting for more favorable offers before re-entering the market.

Platts is part of S&P Global Commodity Insights.