Canada’s farmers are bracing for another unpredictable harvest, as Agriculture and Agri-Food Canada’s latest crop outlook paints a picture of deepening drought in the West, excessive rain in the East, and a global market tilting on trade tensions and biofuel demand. Released June 20, the report reveals the delicate balancing act facing producers in 2025–26: how to grow amid shrinking margins, erratic weather, and shifting geopolitics.
This year, over half of Canada’s agricultural land entered the growing season under drought conditions. In Alberta and Saskatchewan, spring arrived hot and dry, tightening the grip of water scarcity on some of Canada’s most productive farmland. Yet along the coasts and into Eastern Canada, rainfall was excessive, delaying planting and reducing standability for crops like canola.
That contrast defines the 2025-2026 crop year. Overall production is expected to slip slightly compared to last year. And while some regions are thriving, others are teetering on the brink of stress-induced losses. It’s a reminder that the future of farming will be hyper-local, even as it’s shaped by global forces.
The Grain Game
Wheat continues to dominate the landscape, both literally and economically. Canada’s spring wheat—prized globally for its high protein content—is projected to remain stable in production and pricing, with a modest bump in Saskatchewan’s average price to $290/tonne. But that optimism is tempered by falling stocks and the need for rain to salvage quality.
Durum, the pasta wheat, tells a more dramatic story. Last year, Canada exported record volumes to Italy, Algeria, and Morocco. But as those nations refill their domestic reserves, the Canadian export market is poised to tighten, with a projected 10% drop in shipments. Prices are holding steady—for now.
Barley and oats, the unsung heroes of feed and food, are facing a quiet crisis. Barley supplies are shrinking as acreage continues to decline, and carry-out stocks are nearing historic lows. Oat exports remain strong to the U.S., but global demand is slipping, and Canadian inventories are barely keeping pace.
The Oilseed Tug-of-War
Canola is the crown jewel of Canada’s crop portfolio, but it’s caught in a vise of climate and commerce. Yields dipped in 2024 due to drought and heat, and though 2025 planting is strong, the forecast production of 18 million tonnes will test the limits of soil moisture reserves.
What’s different this time is demand. Domestic crush is booming, with new processing capacity and record industrial use signaling Canada’s growing role in global biofuel supply chains. Yet as exports slow, particularly to China, farmers are watching closely. With prices forecast to climb to $700/tonne, every hectare counts.
Pulses Under Pressure
In pulses, the news is mixed. Lentils are holding steady, but dry peas are in trouble. After years of heavy exports to China, new import tariffs are slashing demand and driving Canadian carry-out stocks to a record high. Prices have already tumbled 20%, with more downside risk ahead.
The shift underscores a larger trend: as trade relations wobble, diversification is no longer optional—it’s survival.
Soy, Rye, and the Shape of Demand
Soybean acres are holding steady, and production remains strong thanks to solid yields in Ontario and Quebec. Yet global oversupply is pushing prices down to $480/tonne, a signal that Canada’s edge in this crop is narrowing.
Rye, on the other hand, is staging a surprise comeback. Seeded area is up 56%, and production is at a 30-year high. Once a niche crop, rye is now drawing attention for its resilience in dry conditions—and for its role in artisanal bread, whisky, and regenerative agriculture.
Despite price drops in many sectors, total carry-out stocks across principal crops are expected to rise in 2025-26. That may sound like a good thing—until you realize much of it is due to sluggish exports, market saturation, and geopolitical roadblocks. The paradox is clear: we’re growing more than ever, but earning less for it.
