News

Commodity outlook 2026: Prices stable but key crops have sourcing risks

Ingredient costs should remain stable in 2026 due to soft commodity prices and record-high stocks – although geopolitical uncertainty may cause disruptions.

While buyers of cereals, oilseeds, and sugar can expect continued availability and limited price volatility in the short term, crop-specific imbalances and ongoing geopolitical risks are creating pockets of uncertainty. These are some of the key findings from the most recent data from the FAO, USDA, and the European Commission.

Wheat and maize: High inventories push prices lower

According to the USDA’s World Agricultural Supply and Demand Estimates (WASDE), global wheat production in 2025/26 is projected to reach 1.097 billion tonnes – a new record – following favourable growing conditions in Canada, Argentina, the EU, and Russia.

At the same time, global wheat ending stocks – the unsold inventories remaining at the end of the marketing year – are forecast to increase to 274.9 million tonnes. As reported by the USDA, these elevated stock levels reflect both strong production and relatively modest growth in demand. High inventories generally exert downward pressure on prices by reducing scarcity and increasing competition among exporters.

Global maize supply is following a similar pattern. While maize production is expected to decline in Ukraine due to wet weather and reduced planting, record output in Brazil and the US is expected to push global ending stocks up further.

These trends are already translating into price movements. According to the FAO’s Food Outlook, published last November, international wheat and maize prices declined steadily in the second half of 2025 and are expected to remain under pressure in early 2026, barring unforeseen weather disruptions.

Oilseeds: Soy and rapeseed stable, sunflower tight

The USDA projects global soybean production for 2025/26 at 422.5 million tonnes, with strong harvests in Brazil, India, and Russia offsetting reductions in Canada and Ukraine. Ending stocks are forecast to reach 122.4 million tonnes – the highest level in more than ten years – supporting price stability across soy-based ingredients.

Rapeseed supply is also increasing. According to the USDA, production in Canada is forecast to reach a record 22 million tonnes, with additional growth expected in Australia and Russia.

However, not all oilseeds are following the same trend. Sunflower seed output is expected to decline due to lower yields and reduced planted area in Ukraine and Russia – the two leading global suppliers. The USDA has cut production forecasts for both countries in its December 2025 update, citing poor harvest conditions.

Meanwhile, the FAO reports that sunflower oil prices were already rising in late 2025, and the organisation expects cottonseed and groundnut outputs to decline in supply during 2026. However, larger global harvests of soybean and rapeseed oils are expected to more than offset these declines, while palm oil markets are projected to remain balanced due to stable output in Indonesia and Malaysia.

Sugar: Surplus expected to keep prices in check

The FAO projects that global sugar production will exceed demand in the 2025/26 season, driven by expanded plantings and favourable weather in Brazil, India, and Thailand. Sugar stocks are expected to rise as a result, and international prices began to ease in late 2025.

The USDA also forecasts higher global sugar output and inventories in its December report, citing strong harvests across key exporters. Unless climate disruptions affect major growing areas, ingredient buyers can expect stable to lower sugar prices into mid-2026.

European outlook: Stable supply, shifting trade flows

The EU Agricultural Outlook 2025–2035, published in December 2025, forecasts that the bloc will remain self-sufficient in key crops such as wheat, barley, rapeseed, and sugar beet through the 2026 season. Soybean imports are expected to continue playing a critical role in meeting demand for plant-based oils and proteins, particularly as the food industry expands its plant-based product offerings.

Demand for cereals used in industrial applications, such as starch and ethanol, is projected to rise, which could influence availability for food-use starches and grain-derived ingredients. At the same time, per capita sugar consumption is expected to decline further in line with nutrition guidelines, while demand for plant-based dairy and meat alternatives is set to grow, albeit at a slower pace than in recent years.

The report also highlights that EU agri-food exports are expected to remain competitive globally, particularly in cereals and dairy, while imports of tropical commodities such as coffee, cocoa, and fruit will remain structurally necessary. Future trade agreements and environmental policy developments could shape production conditions and input costs, with implications for long-term ingredient sourcing strategies.