Canadian wheat rises to its highest price since June 2025 tracking futures rally

Canadian wheat prices surged May 12 to their highest price since last June as US wheat futures rallied sharply following a bearish World Agricultural Demand Estimates supply outlook.

Platts, part of S&P Global Energy, assessed Canada Western Red Spring Wheat 13.5% FOB Vancouver 30-45 days forward at $289.54/metric ton May 12, up $10.10 day over day, its highest level in 2026 and the highest price since June 2025.

The price breakthrough came after the US Department of Agriculture's May WASDE report showed low US wheat ending stocks and production estimates, while deteriorating crop conditions added support to the rally.

The MIAX hard red spring wheat futures settled 37.50 cents higher for both the May and July contracts to 715.25 cents/bushel and 724 cents/bu, respectively. The rally began in the morning, with the market opening 8-10 cents/bu higher than the previous close after the USDA's May 11 Crop Progress report showed declining crop conditions, with 40% of the winter wheat crop rated in poor to very poor condition, 3% higher than the previous week, as drought conditions in the US weighed on crop quality.

The gains accelerated after 11:00 am CT following the release of the May WASDE report, which revealed USDA's first estimates for 2026-27. US wheat production fell 425 million bushels compared to 2025-26 to 1.56 billion bushels, while ending stocks were lowered 18% to 762 million bushels. Survey-based production forecasts also showed lower wheat production to 1.048 billion bushels "primarily on sharply reduced Hard Red Winter production," the report stated.

The global outlook was also bearish, with expectations of lower supplies, lower consumption, reduced trade, and decreased ending stocks compared to 2025-26.

Canadian wheat basis premiums were heard 10 cents lower day over day, slightly softening the flat price increases as the futures rally outpaced physical market adjustments. The basis weakness reflected typical market dynamics, with rapid futures gains temporarily compressing premiums as physical traders reassessed value against new price levels amid stable CWRS market fundamentals.

The big swing in futures elicited a mixed response from the market: some responded immediately to the fluctuation, while others waited.

"Everything is frozen now," a US trader said. "No valid price signals today," he added, reflecting the market disruption caused by the volatile session.

On the producer side, higher prices incentivized sales. "I'm sure the industry bought a lot of [tons] today," a Canadian trader said, suggesting the rally triggered producer sales that had been held back at lower price levels in the week prior.