BY: Chuck Penner, Owner, LeftField Commodity Research
One of the most dependable features of crop markets is summed up in the saying, “The best cure for low prices is low prices” and vice versa. The reason why this principle is so reliable is that it’s true. Low prices reduce supplies by discouraging acreage while also encouraging more consumption. Once that happens and supplies are scarcer, prices start to rebound, triggering more acreage and production, which starts the whole cycle over again. At least, that’s the theory.
For the most part, crop markets work that way, or at least they try to. Distortions occur when the weather doesn’t cooperate, like we saw in the 2021 drought when many crops experienced record high prices. On the flipside, sometimes the weather cooperates too much, like it did in 2025 and record yields drove prices lower. Crop markets are constantly trying to find a balance between supply and demand, but never really seem to get there, resulting in higher and lower price cycles. Throw in a few trade-related market distortions and things get a little “wonkier.”
Each crop has its own set of factors that affect supply and demand in Canada, North America and around the world. For pinto and black beans, Canadian production is important, but crops in the United States are considerably larger and have more influence. In 2025, U.S. acreage of both types of beans spiked higher, including record seeded area for black beans. Thus, it wasn’t surprising that prices dropped to multiyear lows in the fall of 2025. At the same time, demand from Mexico started to soften as its own production started to rise (in response to high prices).
Now that bids have cycled lower, especially for black beans, and are in the bottom third of prices of the last 10 years, the market can start the process of low prices curing low prices. Farmers will reduce acreage in 2026, starting the next stage of reduced supplies and an eventual price recovery. As always though, the weather can complicate the outlook, for better or for worse.
This picture for dry beans also fits the pea market, especially for yellow peas. After the big 2025 crop, bids have dropped into the bottom third of the long-term range, and seeded area will decline in 2026. For peas though, the 2025/26 market cycle was distorted and the downward portion of the cycle was accelerated by import tariffs from Canada’s two largest buyers. In the end though, this could set the stage for an even sharper reaction higher, if farmers pull back in a big way from planting peas this year.
The soybean market is in a slightly different place in the cycle. Prices had already dropped to multiyear lows in late 2024, which discouraged farmers from planting soybeans in 2025, at least in the U.S. Even with record yields this year, American soybean production declined, which has helped pull Canadian bids up toward the top third of the longer-term price range.
The key question for the soybean market is whether current prices, especially in relation to corn, will encourage more acres in 2026. Keep in mind that for soybeans, market dynamics aren’t quite that simple. Government intervention in the U.S. in the form of biofuel incentives and in China with tariffs have had a distorting effect, and those will continue to overshadow normal market behaviour. Even so, the soybean market will still be influenced by supply and demand factors and will follow a cycle.