Global wheat production exceeds demand by 20 mln tons — GrainCorp

In fiscal 2026, global wheat production exceeded consumption by approximately 20 mln tons, leading to lower international grain prices and weaker profitability across the agribusiness sector. According to Australian grain company GrainCorp, excess supply restrained trading activity as farmers were reluctant to sell their grain at low prices. Meanwhile, disruptions to grain exports from the Black Sea region caused by Russia’s war against Ukraine have recently contributed to a partial recovery in prices.

For the financial year ended September 2026, GrainCorp reported a net loss of AUD 10.1 mln, compared with a profit of AUD 39.9 mln a year earlier. The deterioration in financial performance was primarily driven by lower grain trading margins. Underlying earnings in the company’s core agribusiness division declined from AUD 218 mln to AUD 156 mln, while GrainCorp’s total underlying earnings reached AUD 222.9 mln.

According to GrainCorp CEO Robert Spurway, global grain oversupply pushed wheat prices to multi-year lows of below 600 US cents per bushel. This reduced farmers’ willingness to market their crops and limited grain traders’ opportunities to generate profits. During the year, the company’s Australian operations handled 28.6 mln tons of grain, of which approximately 6 mln tons were exported. GrainCorp operates a network of more than 170 grain handling facilities across Australia’s east coast.

Despite the challenging results in 2026, the company expects market conditions to improve in 2027. Disruptions to grain supplies from the Black Sea region could be one of the factors supporting a recovery in margins, creating additional opportunities for Australian exporters. Meanwhile, Australian grain production is expected to decline somewhat. According to government agricultural forecasts, the winter grain harvest on Australia’s east coast is projected at around 26.6 mln tons in the 2026/27 season, below the previous season’s level.

GrainCorp management expects stronger trading margins to offset a potential decline in grain handling and export volumes. However, the outlook will ultimately depend on the results of the harvest, which has only just begun, as well as developments in global markets. Recent rainfall in Australia has created favorable conditions for summer crop planting, while future price movements will largely be determined by the global supply-demand balance and the stability of international grain shipments.

Tags: wheat, global market