GRAIN growers on Australia’s east coast are holding back on trading, with poor weather and global oversupply creating difficult market conditions and contributing to shares in agribusiness giant GrainCorp taking a tumble.
Factors included near-record international production of grain and oilseed resulting in oversupply, placing pressure on profit margins for domestic producers.
The GrainCorp share price dived 18% to $7.06 at the time of reporting as investors responded to the sale of GrainsConnect (a Canadian entity) to Canadian agribusiness Parrish & Heimbecker on Wednesday.
GrainCorp managing director and chief executive Robert Spurway referred to a “challenging” financial performance by GrainsConnect, with the decision to sell made after a strategic review.
“This transaction reflects GrainCorp’s ongoing commitment to portfolio optimisation and our readiness to rationalise assets where necessary to improve returns,” he said.
“Divestment of GrainsConnect allows GrainCorp to focus on alternative value-creating opportunities that are in the best interests of our shareholders.”
Graincorp was one half of the joint venture partnership alongside Japan’s Zen-Noh Grain Corporation.
The transaction is expected to generate a loss of AU$5-10 million.
In an official statement from the board, GrainCorp said an additional cash payment for net working capital when the deal closes.
GrainsConnect was valued by the transaction at close to AU$165 million on a cash free and debt-free basis.
The Trading Update Harvest activity for the 2025 to 2026 winter crop is largely complete in Queensland and northern New South Wales, while weather interruptions continue to affect southern NSW and Victoria.
GrainCorp’s 2026 financial year receival volumes are being impacted by an expected lower year-on-year ECA crop.
GrainCorp’s preliminary estimate of total receival volumes for the 2026 financial year is 11 to 12 million tonnes, compared with 13.3 million tonnes received in the 2025 financial year.
“In response to these conditions, GrainCorp is maintaining a strong focus on cost management while continuing to deliver industry-leading customer service and reliability,” the statement read.
GrainCorp is to provide an earnings guidance at its annual general meeting on 18 February 2026.