By: Editorial Team, StoneX Media
Grain markets are looking beyond current harvest results toward the next potential supply shock. While disappointing European yields have already supported prices, attention is increasingly turning to South America's upcoming planting season. The growing likelihood of a strong El Niño event is introducing fresh uncertainty into production expectations before crops are even in the ground. Consequently, weather risk is extending bullish sentiment beyond today's harvest and into the next global supply cycle.
Bertrand Oesterle, Vice President of Clearing and Execution Sales at StoneX, works closely with commercial agricultural participants navigating global grain markets and hedging decisions. His discussions with StoneX teams across Europe, Brazil and the United States provide a timely perspective on how regional production risks are combining to reshape global market expectations.
El Niño expectations are becoming an increasingly important driver of grain market pricing because traders are beginning to evaluate risks to future production rather than current harvests alone. Oesterle explains that the market could "bridge to the next big thing, which is expected to be El Niño", while noting that the Climate Prediction Center sees "an 81% risk of El Niño being very strong from October to December". Consequently, weather uncertainty is being incorporated into forward price expectations months before South America's growing season reaches its critical stages. This shift encourages commercial participants to monitor seasonal forecasts alongside traditional supply and demand indicators as new risk premiums develop.
Brazil's next soybean and corn crops are becoming central to the grain market outlook because producer confidence is beginning to soften. Oesterle reports that Brazilian clients remain "very uncertain about the impact of El Niño" and that "farmers have definitely shown some resilience in selling forward" as uncertainty grows. As a result, slower forward marketing and cautious planting decisions could amplify market sensitivity if adverse weather materialises later in the season. At the same time, Oesterle notes that genetically improved crops may provide resilience, reinforcing that the eventual production impact remains uncertain despite growing concern.
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--- Written by Frédéric Guétin, StoneX TV Producer
--- Expert: Bertrand Oesterle, StoneX Vice President of Clearing and Execution Sales
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Lithuania and Latvia are moving to shut Russian grain out of their Baltic ports while the Black Sea corridor stays disrupted. The routes still open are narrowing, and international wheat buyers are already sourcing elsewhere.
September 9 – Nearby Brent crude oil futures have broken above $100 for the first time in over six weeks amid fresh escalations targeting energy assets in both the Middle East and Black Sea. A tit-for-tat cycle of strikes on vessels in and around the Strait of Hormuz has persisted in recent days, with CENTCOM reporting U.S. strikes having destroyed five Iranian crude oil tankers yesterday, then Iran escalating overnight, claiming attacks on two U.S. naval vessels and eight oil tankers in the Gulf, though that has not yet been verified by the U.S. What stood out to me regarding yesterday’s strikes was the targeting of an Iranian oil tanker near the anchorage area of Kharg Island, Iran’s primary oil export hub. The proximity of this strike to Kharg Island could be interpreted as a deliberate warning: Washington is demonstrating its ability to hit Iran’s oil-export system at the doorstep of the country’s principal crude terminal while, for now, stopping short of targeting the infrastructure itself. At the same time, Ukraine carried out heavy strikes on Russia’s Novorossiysk, the country’s top Black Sea port for commodity shipment. While confirmed details are still sparse, the Russian naval base in the area appears to have been the top target, with energy terminals damaged as well, but no damage to grain infrastructure has been reported at this time. On the other side, Russia continued their campaign of heavy strikes across Ukraine, including an ongoing focus on Black Sea port cities, with Mykolaiv reportedly suffering notable damage. The other notable target was the border crossing from Ukraine into Moldova at Starokozache, highlighting Russia’s new campaign targeting alternate routes for Ukrainian grain shipments amid the effective closure of the Black Sea. Both wars are increasingly becoming wars against commodity logistics, keeping support under the broader complex as traders await what comes next.
September 8 – Geopolitical escalation remains in focus to start the short week, with stock futures pointing to a mixed open and WTI crude oil prices posting a fresh three-month high amid a ramp-up in fighting in both the Middle East and Black Sea. The VIX is up notably from its 2026 low posted on Friday but remains relatively muted as it trades above the 15.4 level. The dollar is quietly lower to start the day, hovering around 98.84 at the time of writing. Treasury yields are also quietly lower to start the day, with the sharpest declines seen at the long-end of the curve; 2-year yields are trading at 4.37%, 10-year yields at 4.77%, and 30-year yields at 5.225%. Nearby WTI pushed to its highest level in exactly three months earlier in the session but has since pulled back to trade near $92.90, up ~1.8% on the day, while nearby Brent pushed to its highest level since July 24th earlier in the session but has pulled back to trade near $97.50 at the time of writing, up only ~0.4%. The ags are widely mixed, with the biggest strength being seen in the wheat complex after weekend talks failed to produce any major results, which we’ll dive into in more depth below.
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