Wheat futures ended with mixed action, as Kansas City Hard Red Winter (HRW) wheat edged higher while Chicago Soft Red Winter (SRW) wheat and Minneapolis Spring Wheat (HRS) closed lower. May 25 CBOT Wheat closed at $5.54 per bushel, down 2 ¾ cents. A key driver of the market was Algeria’s wheat purchase, estimated at 500,000 to 650,000 metric tons (MT), along with expectations for increased Canadian wheat acreage in 2025.

Corn posted significant losses, falling across all contract months. The May 25 CBOT Corn contract closed at $4.60 ¾ per bushel, down 9 ½ cents. Weakness in the market was driven by concerns over potential retaliatory tariffs from the European Union (EU) in response to U.S. steel and aluminum duties, which could impact U.S. corn exports. Additionally, ethanol production declined by 31,000 barrels per day (bpd), signaling weaker demand.

Soybeans remained under pressure throughout the session, closing with declines of 9 to 11 cents across most near-term contracts. The May 25 CBOT Soybean contract closed at $10.00 ½ per bushel, down 10 ¾ cents. The soybean market reacted to worries about EU retaliatory tariffs, which could hit U.S. soybean exports, along with a slowdown in demand for soybean meal and oil.

Key Global Market Developments Impacting Grain Prices

The grain markets faced a range of global developments on Wednesday, with ongoing geopolitical conflicts, trade tensions, and weather shifts shaping the trading landscape.

Russia’s missile strike on the Ukrainian port of Odesa resulted in four Syrian sailors killed on a Barbados-flagged vessel loading wheat for export to Algeria. This attack comes as the U.S. pressures Russia to accept a 30-day ceasefire agreement amid ongoing conflict negotiations. The destruction of port infrastructure raises concerns about Ukraine’s ability to sustain grain exports in the coming months.

Algeria purchased between 500,000 and 650,000 MT of wheat in a tender on Wednesday. While specific suppliers remain unclear, traders suggest that some shipments may come from Russia or France. This large purchase reflects strong demand amid global supply disruptions.

Workers in Argentina’s soybean processing sector launched an indefinite strike over unpaid wages from agribusiness giant Vicentin. The labor action began at two processing plants in Rosario and has since expanded across the country. The disruption threatens soybean meal and soybean oil exports, critical to global supply chains.

Brazil’s soybean exports are now expected to reach 15.45 million MT in March, a more than 4% increase from last week’s estimate. If realized, this would mark a record March export volume. Brazil continues to dominate global soybean trade, intensifying competition with the U.S. and Argentina.

Russia’s Agriculture Ministry issued an order to distribute an additional 26,660 MT of wheat export quotas among nine companies. The total wheat export quota for 2025 is 10.6 million MT, valid from February to June, with 8.6 million MT already allocated in February.

Ahead of Thursday’s USDA Export Sales report, traders anticipated wheat sales between 275,000 and 650,000 MT, corn sales between 750,000 and 1.4 million MT, and soybean sales between 275,000 and 700,000 MT. Uncertainty over actual sales figures contributed to market hesitancy.

The EU plans to impose retaliatory tariffs on U.S. agricultural products, including corn and soybeans, in response to President Trump’s tariffs on steel and aluminum. While the EU currently has little U.S. corn and soybean purchases, it has received 4.5 million MT of U.S. soybeans this marketing year. These trade tensions add further pressure to grain markets.

The latest EIA ethanol report showed a decline in production, down 31,000 bpd to 1.062 million bpd. Ethanol stocks rose by 87,000 barrels to 27.376 million barrels, with Midwest storage reaching a record 11.537 million barrels. Weaker ethanol production is limiting corn demand.

North America continues to experience above-average temperatures, with drier conditions expected in the Southern Plains through March 20. In South America, Argentina remains warm and dry, while coastal rains in Brazil are offering some relief to crops. These weather trends are influencing planting conditions for the upcoming season.

Statistics Canada released planting intentions data, projecting Canadian wheat acreage to increase by 2.6% to 27.475 million acres in 2025. The rise is primarily driven by spring wheat, which is forecast at 19.42 million acres, while durum wheat acreage remains steady at 6.36 million acres. Canola acreage, however, is expected to decline by 1.7% to 21.65 million acres.

Chinese agricultural futures reflected overall weakness, with May 25 soybeans down 44 yuan, soymeal down 33 yuan, and soyoil down 58 yuan. However, palm oil prices in Malaysia edged 1 ringgit higher (+0.02%) at 4489, reflecting continued demand for edible oils.

The USDA did not adjust its estimates for South American crop production, keeping Brazil’s soybean output at 169 million MT and Argentina’s at 49 million MT. However, Chinese soybean crush increased by 2 million MT, bringing Chinese ending stocks down to 43.96 million MT. These factors contributed to the weaker sentiment in soybean markets.

Outlook for Thursday’s Trading Session

The grain markets remain under pressure as traders assess global supply risks, geopolitical tensions, and trade policy uncertainties. The key focus for today will be the USDA Export Sales report, which will provide fresh insights into U.S. export demand. Additionally, market participants will continue monitoring the evolving situation in Ukraine, Argentina’s labor strike, and Brazil’s export pace. With uncertainty surrounding U.S.-EU trade relations, ethanol demand, and weather shifts, volatility is expected to persist in the coming sessions.