It's been another big week of harvesting in southwestern Ontario. The weather in October has not been perfect, but it's been close.

Soybean harvest is nearing completion across the province, and corn harvest is really ramping up this past week as I nudged into my own corn. I am finding it an above-average crop and not quite the record levels it was last year.It's just an example of the risks we take; every year is different.

Amid all the fieldwork this past week, there was a decision by the Bank of Canada to raise interest rates, which will eventually cost farmers more money.The Bank of Canada raised its benchmark interest rate by 0.25 percentage points last Wednesday, taking the overnight policy rate from 2.25% to 2.50%. This was the Bank of Canada's first interest rate increase since July of 2023.

As an agricultural economist, this is the kind of stuff that I love to see working. Interest rates are like the lubrication of the economy and are often used by central banks to infuse and then again to temper economic activity. The Bank of Canada has raised these rates because inflation was a little bit more effervescent than they had been thinking, running around 3%, which is above the bank's target of 2%. Energy prices are higher, and the Canadian economy has been stronger than expected. Raising interest rates is always the hammer to keep the economy from growing too fast and to mitigate inflation.

For Canadian farmers, this just made everything a little bit more expensive. Whether that be with equipment financing, operating loans or land payments, everything is going to cost a little bit more. No, it's not 23.25% interest that I paid back when I was a beginning farmer, but at these higher cost levels, every little bit counts.

At the same time, we have seen lots of planting progress in the southern hemisphere. Eventually, November will probably render snow on the ground somewhere here in Ontario. Needless to say, that makes it hard to imagine that this is planting time for the world's largest soybean producer, Brazil. Soybean prices have seemingly been in the tank over the last several trading sessions. Eventually, this big crop in Brazil will sway whether those prices will continue to wobble.

Interestingly enough, there was a bit of a geopolitical angle on why soybean prices have been declining over the last few weeks. One of them was Luiz Inacio Lula da Silva beating Senator Flavio Bolsonaro in the Brazilian presidential election. It seemed like soybean prices were going down because of the Lula election win.In fact, some prediction markets had their algorithm trained for a Bolsonaro victory, and the resultant surprise caused the decline in prices.

In essence, the bottom line is that the global soybean market is not an economic game but increasingly a political one. But one thing has not changed regarding soybean exports: the U.S. dollar and the Brazilian real have strengthened and weakened over the years. Brazil's soybean exports are growing continually, and the United States soybean exports are not. Needless to say, in 2026, when trading algorithms have a myriad of programmable reactions, it can lead to volatile markets.

These kinds of market factors will continue to happen from 30,000 feet. However, sometimes I think that some of the most interesting gyrations are what's happening at the local level. This past week, as I was delivering some of my corn, I saw several delegations from the Far East visiting, looking to procure soybeans for a resilient soybean food market in Asia. As one soybean buyer in Singapore once told me, every day somebody in East Asia sits down and consumes some soybeans. They don't do it as much in North America because they don't like the beanie taste. However, just think if they did, it would certainly help local soybean producers.

Keep in mind that Asian buyers are interested in quality, and generally speaking, Canadian soybeans do it for them. However, keep in mind that price is always important. Take that 10% tariff that China still has on American soybeans. That is keeping American soybeans out of China, but at the same time those American soybeans are finding themselves getting into markets that have been traditional for Canadians. So, at the end of the day, economics always matters with a trade-off against quality.

As we head into November, there will be plenty of market gyrations left to come as harvest wraps up here in Ontario and the big soybean crop in Brazil gets established. Corn prices will have their own challenges with a big American crop hanging over the market. In the meantime, we need to keep nudging along in the corn, watching the markets and reminding ourselves that next year's crop is already somewhere on the horizon.There is never a shortage of things to think about within our risk management agenda.

Philip Shaw can be reached at philip@philipshaw.ca

Follow him on social platform X @Agridome

(c) Copyright 2026 DTN, LLC. All rights reserved.