Crop Recap – Tuesday, May 13 Closing Prices (Chicago, July 25 Contracts)

Wheat

Chicago SRW wheat futures closed slightly higher at $5.17¼ per bushel, gaining 2 cents in a modest recovery after prior losses. The bounce came despite ongoing concerns about elevated global wheat stocks and disease pressures in the U.S. Plains. USDA data showed U.S. winter wheat rated 54% good-to-excellent, a 3-point improvement from last week. Kansas, a top producer, is grappling with a wheat curl mite outbreak, raising potential yield risk despite recent rain. Meanwhile, EU wheat exports have fallen by 9.15 MMT compared to last year, and France trimmed its soft wheat acreage by 100,000 hectares.

Corn

Corn futures ended the day lower, with the July 25 contract closing at $4.42½ per bushel, a 5½ cent decline. Despite strong planting progress, now at 62% complete and 6 points above the five-year average, the bearish tone was driven by USDA's projection of a record U.S. crop at 15.82 billion bushels and larger-than-expected Brazilian output, now pegged at 130 MMT. Analyst Michael Cordonnier, while more conservative, raised Brazil’s projection to 127 MMT. Export inspections dipped from the previous week, and emerging fears over weaker fourth-quarter U.S. exports weighed on sentiment.

Soybeans

Soybeans showed slight strength, closing at $10.72½ per bushel, up 1¼ cents. The market found support from rising soyoil futures and a proposed U.S. House bill to extend the 45Z tax credit for renewable fuels. Soybean planting reached 48%, well above the five-year average of 37%. ANEC raised Brazil’s May export forecast to 14.27 MMT. Traders balanced optimism from U.S.–China tariff relief and high inspections (426,077 MT) with cautiousness around ongoing global supply pressures. Speculative positioning remained net long, but slightly trimmed.

Key Global Drivers

A 90-day tariff truce between the United States and China continued to dominate global agricultural sentiment. The easing of duties—now 10% on U.S. goods entering China and 30% on Chinese goods entering the U.S.—lifted hopes for higher U.S. export volumes, particularly in soybeans and wheat, though analysts urged caution regarding long-term impacts.

China’s wheat imports increased sharply due to heatwaves in Henan province. The government procured between 400,000 and 500,000 metric tons from Australia and Canada, marking the return of Australian wheat to China for the first time since last year. This move was seen as weather-driven and opportunistic amid a risk-laden growing season.

In Brazil, the government is advancing discussions with China on a major logistics project—a railway that would link the Chancay port in Peru to Brazilian grain regions. The proposed line would bypass the Amazon and reduce the distance to Asia by over 6,000 miles, reshaping Brazil’s global competitiveness in bulk grain exports.

Brazil’s soybean momentum held firm despite port premium declines post-U.S.–China tariff truce. With 57% of the record 170 MMT crop already sold, the country is still forecasted to ship 108.3 MMT this season. However, port premiums fell 10% at Paranaguá on Monday, reflecting shifting demand expectations.

Corn prices in Brazil weakened further under pressure from favorable crop weather and a declining real. April exports surged to 178,000 tons, up 170% year-on-year, yet domestic demand softened as buyers anticipate continued devaluation.

Argentina's corn and soybean harvests progressed under mixed conditions. Rain improved soil moisture for winter wheat sowing, while the Buenos Aires Grain Exchange lifted its soybean estimate to 50 MMT. Sustained precipitation will be crucial to maintain this trajectory.

Ukraine’s spring grain sowing reached 4.32 million hectares, 76% of the expected total. Yet analysts reduced the 2025 harvest forecast by 3.8%, mainly due to lowered corn yield expectations. Grain exports for 2025/26 are now forecast at 40.9 MMT, down from 42.6 MMT previously.

India’s monsoon forecast brought renewed optimism. Rainfall is expected by May 27, five days earlier than normal. As nearly half of Indian farmland relies on monsoons, the development bodes well for summer crops including rice, corn, and soybeans.

U.S. weather remained diverse, with isolated showers in the Northern Plains and above-normal temperatures set to ease midweek. The Midwest is heading into a cooling phase with expected rainfall. Meanwhile, the Central and Southern Plains experienced patchy rains, and wet conditions persisted in the Lower Mississippi Valley.

In Europe, rainfall improved soil moisture across France, Spain, and Poland, benefiting soft wheat and corn. However, dry weather in Germany remained a concern, potentially stressing crops if conditions persist. The Black Sea region saw favorable rainfall, but risk of frost remained with continuing cold intrusions.

Malaysia’s palm oil stocks jumped 19.4% month-on-month in April to 1.87 million tons, driven by a 21.5% surge in production and weaker domestic consumption. The increase surprised analysts and could pressure global vegetable oil prices, though palm oil remains competitively priced relative to alternatives.

Speculative positioning in the U.S. grain markets reflected shifting sentiment. Wheat saw net short positions trimmed, while net long positions in corn and soybeans were reduced modestly. Traders appear cautiously optimistic, awaiting further trade signals and weather confirmation.