Wheat

Wheat markets extended their decline on Wednesday, weighed down by a lack of bullish catalysts and firming global production. The July 2025 Chicago SRW wheat contract closed at $5.28¼ per bushel, down 7½ cents from the previous session. Kansas City HRW and Minneapolis HRS futures also posted significant losses, falling by 10–11 cents and 13–14 cents, respectively. Russia’s wheat output is now pegged at 83 million tons, according to Sovecon, slightly above prior forecasts. Weather conditions in Russia’s Ural and Volga regions remain favorable, further supporting yield potential. Meanwhile, European wheat struggles with export demand, and US traders are eyeing the upcoming USDA Grain Stocks report for fresh direction.

Corn

Corn futures continued their downward trend, with July 2025 contracts closing at $4.10¼ per bushel, a 6-cent decline on the day. The market is responding to non-threatening US weather forecasts and surging Brazilian output. Brazil’s second corn crop estimate was raised by 10 million tons, bringing total 2024–25 production to 150.3 million tons, with 44.5 million tons earmarked for export. Ethanol output in the US fell to a four-week low of 1.081 million barrels/day, while inventories rose to 24.4 million barrels. Despite some rainfall in the Corn Belt, concerns persist over weak demand and the looming USDA acreage report. South Korea’s overnight purchase of 266,000 MT of corn added little support amid growing global competition.

Soybeans

Soybeans bore the brunt of Wednesday’s sell-off, with the July 2025 contract dropping 21½ cents to close at $10.25¼ per bushel. Soymeal and soyoil markets also weakened, reflecting lower crude oil prices and reduced demand sentiment. The cmdtyView national average cash price fell to $9.79¼. Weather forecasts point to more widespread rains in the US Midwest, relieving stress on soybean crops but applying further pressure on futures. Brazil’s exports remain strong, with ANEC projecting 14.99 million tons of soybeans to be shipped in June. However, caution prevails ahead of the USDA Acreage and Export Sales reports, as open interest declines and traders adjust positions.

Global Developments Driving Market Sentiment

Brazil’s mammoth corn crop is disrupting global trade dynamics. Agroconsult now estimates 150.3 million tons, far surpassing USDA and national projections. With 44.5 million tons set for export, US corn is facing intensifying price pressure.

Russia's wheat harvest is now forecast at 83 million tons, boosted by favorable spring conditions. Sovecon’s latest outlook adds upward momentum to Black Sea competition, while the EU continues to underperform in exports.

Iran emerges as a key buyer in Russia’s expanding grain trade. Rusagrotrans projects Iranian wheat imports from Russia could triple to 3–4 million tons, with corn and barley imports expected to reach 3.6 million tons amid lifted restrictions and deeper economic ties.

Heavy rains in North China Plain have eliminated prior soil moisture deficits, improving summer crop prospects, especially for corn and soybeans. This development reduces short-term weather risks in one of the world’s top grain consumers.

The USDA Crop Survey shows planting intentions for corn and soybeans remain near March estimates, with corn at 95.4 million acres and soybeans at 83.5 million acres. Wheat planting holds steady at 45.4 million acres, while June 1 stocks will be closely watched in the upcoming report.

Ethanol production in the US decreased by 28,000 bpd to 1.081 million bpd, the lowest in four weeks. Stocks rose, and exports declined, adding another bearish layer for corn-linked biofuel demand.

In weather, North America saw mixed conditions. Heavy rainfall helped ease drought in Montana, while North Dakota dealt with storm damage. Rainfall persists across the Midwest and Corn Belt, raising both opportunities and delays in crop development.

Southern Europe faces heat and dryness risks heading into July. Soil moisture is already low, particularly in Western and Central Europe, threatening spring crops. Ukraine may worsen, but Russia and Kazakhstan outlooks remain favorable.

Malaysia’s deforestation-free palm oil trade gains traction. A new trade deal with the European Free Trade Association reinforces market access for certified sustainable palm oil, aligning with global green trade standards.

In the livestock sector, US hog inventory is slightly down at 74.77 million head, with minor declines in both breeding and market hog categories. However, the March-May pig crop rose by 1%.

Japan lifted all restrictions on Brazilian poultry imports, boosting feed demand for soybeans and corn. The move follows recovery from bird flu outbreaks and could strengthen Brazil’s position in global meat trade.

Lastly, Senator Josh Hawley’s criticism of Tyson Foods and calls for more competition in the meatpacking industry could lead to broader policy shifts impacting grain-fed livestock operations.