Geopolitics rather than market fundamentals will shape agriculture across Europe and the UK in 2026, according to Rabobank, which warns that global food markets are being pulled into rival spheres of influence dominated by the US and China.
The latest Agri Commodity Outlook argues that agricultural commodities are increasingly being deployed as strategic tools rather than traded solely on supply-and-demand dynamics.
Carlos Mera, the bank’s head of agri commodity markets research, said: “Agriculture is no longer playing by supply-and-demand rules, it’s playing by geopolitical ones,” adding that the world is only “at the beginning of the middle game.”
For European and UK producers, the consequences are significant. Traditional trading routes are becoming less reliable, while subsidised production in Brazil, Russia and parts of Asia threatens to erode competitiveness for EU and UK exporters.
At the same time, the EU’s Green Deal targets and the UK’s post-Brexit Environmental Land Management schemes are reshaping domestic production just as global rivals expand subsidy support.
What began as a tariff conflict has developed into a global subsidy competition. Governments worldwide have rolled out increasingly interventionist programmes — from minimum prices to biofuel mandates — which are preventing the usual contraction in output that would follow low prices.
Rabobank expects this to keep global planted area elevated and maintain pressure on grain and oilseed markets heavily relied upon by European millers, crushers and livestock producers.
The report highlights major shifts in the United States, where farmers have reduced soybean area to its lowest level in six years due to concerns over future Chinese demand.
Maize plantings, by contrast, have reached their largest level since the 1930s. The resulting surge in US corn stocks by the end of 2025/26 is expected to depress global maize prices further — a development likely to weigh on UK feed markets and limit upside for domestic wheat.
Europe and the UK also face widening price gaps between regions as tariffs and non-tariff barriers distort basis levels. Rabobank expects these “geographic price differentials” to grow in 2026, complicating procurement for UK feed compounders and raising uncertainty for major European importers such as Spain, the Netherlands and Germany.
Some earlier tariff measures are now being reconsidered. US authorities are reviewing levies on products the country does not produce, such as coffee and cocoa — a move that could benefit European processors but increase global competition.
Rabobank’s commodity forecasts include a shift to surplus in coffee markets for 2026/27, stabilising prices after the historic highs of 2025. Cocoa production is also recovering, with a projected surplus for two consecutive seasons.
For Europe — home to the world’s largest chocolate manufacturing sector — extended price softness would ease cost pressures on processors but may create volatility for suppliers.
Global wheat output is expected to show a surplus in 2025/26 but return to deficit a year later as low prices trigger area reductions. For the UK and EU, cheap global maize is likely to cap domestic wheat prices unless supply shocks or geopolitical events disrupt markets.
Across all commodities, Rabobank notes a common thread: political tension is outweighing economic logic. “We foresee continued trade disruptions, fluctuating regional prices, heavy government intervention, and a high probability of unexpected events,” said Mera.
With unpredictable trade flows, shifting alliances and heightened intervention abroad, Rabobank says farmers, traders and policymakers must prepare for a landscape where uncertainty is permanent and agility is essential. As the report concludes, the unexpected “is now the baseline.”
