Looking to the Futures

Canada is the world’s largest exporter of oats with their top destination being the United States. According to the Observatory of Economic Complexity, Canada shares roughly 40% of all global oat exports and from May 2025 to April 2026, they exported 456 million worth of oats in Canadian Dollars to the United States. For perspective, the next highest dollar figure is their partnership with Mexico which is estimated at 50.3 million. 

Canada’s Balance of trade tends to lean towards a trade surplus meaning the value of their exports exceeds the value of their total imports.  In April of 2026, Canada exported 67.6 million (Canadian Dollars) worth of oats while only importing 172k resulting in a positive trade balance of 67.4 million for the commodity. Conversely, we saw the U.S. run a trade deficit with oats.  In April of 2026 the U.S. imported 28.7 million while exporting 1.05 million resulting in a negative trade balance of 27.6 million for the commodity. 

With the North America Oats Market Report published in February 2026, according to Market Data Forecast the Oats market is expected to grow 5.31 percent CAGR (compound annual growth rate) over the next 8 years.  This import and export data is currently painting a different picture regarding market share based compared to 2025. 

As oats are primarily harvested from August to September it is important to monitor the weather trends of this cyclical commodity. Oats are harvested primarily from August to September. Current government and industry assessments point to around one quarter of agricultural land as abnormally dry or in a drought from May to current in Canada.  According to the National Oceanic and Atmospheric Administration, El Nino is expected to strengthen this winter, and they have issued an advisory.  El Nino, or the warming of the Pacific Ocean temperatures, will shift global rainfall by weakening Pacific Trade winds which can lead to dryer than expected conditions in otherwise normally wet landscapes. Although El Nino is projected to form after the Oats harvest season, it can put these trending dry conditions and impact planting season for this cyclical commodity. 

There was a contract roll from July Oats (/ZON26) to September Oats (/ZOU26) which is a textbook example highlighting risks associated with the costs of continuing to hold a futures position over different expiration months.  Oats futures currently trade in contango meaning the futures price of the commodity is higher than the spot (current) price. As you shift out further expirations, the basis or difference between the futures price and the spot price diverges. 

As the July Oats (/ZON26) contract approached its first notice date, you'll notice open interest fell from 3000+ contracts to 133 meaning that traders or hedgers were not looking to take physical delivery of the product.  This created liquidity and price risks by causing the front month contract to diverge from all of the other further dated contracts.  A large majority of the open interest on the July contracts have since shifted to the September contracts but the price divergence or cost to roll was felt by traders through wide spreads and small liquidity. 
 

Major economic reports, trading events, and news items that could potentially impact specific futures markets:

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