Ontario mostly grows soft red winter wheat
The spring of 2026 has been a really interesting time in the wheat markets.
We’ve seen sharp rallies in the Chicago futures markets and an interesting assortment of cash bids to farmers for ’25, ’26 and ’27 crop wheat. But what is driving all of this excitement and how long can it last?
At the core of the wheat market’s strength is the simple reality that U.S. wheat planted acres for 2026 are at their lowest level in more than a decade. In 2023, American farmers planted a record 49.6 million acres of wheat but the wheat crop-size has shrunk in every year since, with the 2026 crop estimated to be only 43.8 million acres. A 5.8 million acre drop in wheat acres over four years is a headline that grabs the market’s attention and makes the managed money react.
The complex thing about the “wheat” market is that wheat is actually five different types of plants which produce products with different uses. Hard red spring, durum, hard red winter, soft red winter, and soft white winter are mostly grown in different regions, and the flour which they produce are used in very different food products.
The dominant type of wheat grown in Ontario is soft red winter, and although total U.S. wheat plantings are lower, the area sown to soft red winter is largely unchanged. The USDA’s current estimates suggest that American farmers will grow 6.14 million acres of soft red winter wheat this year. This crop area is virtually identical to the previous crop in 2025. Ontario farmers seem to have made the same crop selection choices as their U.S. neighbours with Agricorp reporting 801,900 acres of insured soft red winter wheat planted in Ontario last fall compared to 805,000 acres for last year’s crop.
There are also three different wheat futures contracts which represent three of the major classes of wheat. The Minneapolis wheat futures are for hard red spring wheat. The Kansas City wheat futures are for hard red winter wheat, the Chicago wheat futures are for soft red winter wheat. In spite of the fact that soft red wheat represents less than 15 % of America’s total wheat acres each year, the Chicago futures market has about 70 % of the daily trading activity of the three wheat futures markets in total, so it attracts an over-sized share of the managed money in wheat trading simply due to its better liquidity than Minneapolis and Kansas City.
The spec fund’s enthusiasm for trading in Chicago has actually created a unique opportunity for eastern soft wheat producers this year, because the lower wheat plantings are almost entirely in the hard red spring wheats grown in the western plains, and yet the Chicago soft wheat futures rallied on the news of lower wheat acres. That’s because Chicago is the casino where the managed money place their wheat bets.
The bottom line is that although total wheat acres are down in 2026, the soft red winter wheat which dominates the eastern Canadian market is not. While there is certainly a lot of time between now and harvest for mother nature to impact total supplies of soft wheat, it certainly won’t be because we didn’t start out with enough acres planted to the crop.
The real challenge for wheat prices, and why they can’t run substantially higher is because in spite of a potentially smaller 2026 crop, a significant portion of the demand for wheat is as a feed grain, and therefore it has to remain price competitive with corn.
In the case on the eastern Canadian soft red wheat market, we typically grow about 2.25 million tonnes of soft red each year. There is about 625,000 tonnes of flour milling capacity in the province, and another 400,000 tonnes moves to U.S. flour mills in Buffalo, Toledo (Ohio) and various points in Michigan. The remaining 1.2 million tonnes either has to leave by vessel out of the St Lawrence River or be used as livestock feed. In really general terms, 20 % to 30 % of Ontario’s soft red winter wheat is used in feed.
The relationship between corn and wheat pricing got badly stretched out of shape as the situation in the Persian Gulf deteriorated into military action. Between February 18 and March 9, July wheat futures at the Chicago Mercantile Exchange jumped 78 cents per bushel, while July corn future only rose 45 cents over the same time period.
Since we know that the cash price of wheat for prompt movement has to stay near to the price of corn in order to create feed demand, this spring’s run up in both 2026 and 2027 wheat values was a sales signal for farmers because as we get closer to delivery time, that price spread has to narrow.
There are two ways for the corn–wheat price spread to narrow. Either the Chicago futures drop or the Canadian cash basis drops, with the United States working its way through the biggest corn crop in history and projecting a carry out in excess of 2-billion bushels. There’s not much chance of corn prices mounting a sustained rally, so the sharp rise in wheat prices is a very clear signal to use this as an opportunity to lock in wheat values.
The spring of 2026 has been a really good time for producers when we look at the wheat markets. Forecasts of a smaller North American wheat crop being planted for this year’s harvest, have been really supportive of the futures prices even though most of the price movement has been in a futures market for a completely different class of wheat.
The outbreak of war in the Persian Gulf firmed up futures markets across the board, but particularly in wheat where the funds had been short for more than a year, (and really; who wants to be short anything if the fertilizer is about to hit the fan?)
But now the prices (this column was written on April 16) have rallied to such a point that it is going to limit demand, and that’s the high point where farmers should use this opportunity to lock in the price gains, and then let the growing season create some different opportunities in other crops.
Steve Kell is a Simcoe County crop farmer and handles grain merchandizing for Kell Grain, with elevators in Belleville and Gilford.
