Market Drivers

Brazil wheat imports could rise as domestic crop declines

 

Brazil’s wheat imports could increase in 2026 as farmers reduce wheat planting due to higher fertilizer and fuel costs, while uncertainty over El Niño is also weighing on production decisions.

 

Brazil’s wheat production could decline by around 25.0% y/y to just above 6.0 Mn tonnes. Wetter conditions in southern Brazil, where most wheat is grown, could further weigh on crop quality as wheat remains more sensitive to excess moisture than corn and soybeans.

 

As domestic output declines, industry estimates suggest imports could rise to 8.0 Mn tonnes, up from 6.9 Mn tonnes last year and potentially reaching the highest level since 2013.

 

Argentina is expected to remain Brazil’s main wheat supplier, but quality concerns could encourage Brazilian mills to supplement imports with cargoes from suppliers such as Russia and the US.

 

While imports from suppliers such as Russia and the US would involve longer-haul trade routes, wheat cargoes into Brazil are typically carried on Handysize vessels, whether sourced from Argentina or more distant origins.

 

Strong wheat imports into Brazil could inflate Handysize tonne-mile demand and support freight rates for the smaller vessels.