Wheat

Chicago wheat futures for July 2025 opened Tuesday at $5.28¾ per bushel, following a mixed Monday session that saw the contract close up 4 cents. Despite the modest gain, market sentiment remains cautious due to higher-than-expected U.S. grain stock estimates and ample global supply. Crop progress data showed the U.S. winter wheat harvest at 37%—lagging the seasonal average—while condition ratings slipped to 48% good/excellent. Export activity offered some support, with shipments for the week ending June 26 reaching 434,538 metric tons, a notable increase from prior weeks. However, the USDA’s Grain Stocks report placed all-wheat inventory at 850.5 million bushels, reinforcing a bearish tone. In Brazil, rains and frost slowed planting in key states like Rio Grande do Sul and Paraná, while in Argentina, dry and cool weather is improving planting conditions and raising hopes for above-average yields.

Corn

July 2025 corn contracts opened at $4.20½ per bushel on Tuesday, showing marginal strength after Monday’s modest 3-cent gain. The USDA’s Grain Stocks report indicated 4.643 billion bushels in storage on June 1—slightly above estimates but down from last year. While planted acreage came in at 95.203 million acres, just shy of prior projections, crop conditions improved to 73% good/excellent, supported by favorable U.S. Midwest weather. However, exports are slowing, with inspections dropping 8.9% week-over-week to 1.37 million metric tons, although still higher than last year’s pace. Brazil’s winter corn harvest progress lags at 18%, hindered by adverse weather, while logistical issues persist at South American ports, sparking concerns about quality and export timing. Mexico, Japan, and South Korea remain key destinations for U.S. corn, but global trade is closely watching crop and ethanol usage trends.

Soybeans

Soybeans opened the Tuesday session at $10.24¼ per bushel, a day after closing 3½ cents lower. Despite a smaller-than-expected U.S. planted area of 83.38 million acres, USDA data showed soybean stocks at 1.007 billion bushels on June 1—above both analyst expectations and year-ago levels. Crop conditions remain steady at 66% good/excellent, with 17% blooming and 3% setting pods. Exports are uneven, with 224,787 metric tons shipped last week, up slightly from the week before but still 30% lower year-over-year. Mexico and Japan led as top destinations. Italy has committed to increasing soybean imports from the U.S., with plans to rebalance trade amid negotiations between the U.S. and EU on upcoming tariffs. In Asia, declining soymeal prices on China’s Dalian Exchange continue to indicate soft demand, while Argentina’s exports face headwinds from recent tax reforms that may reduce July shipment volumes.

Key Global Market Developments

The U.S. Department of Agriculture announced a phased reopening of Mexican cattle imports following screwworm-related border closures. Starting July 7, ports like Douglas, Arizona will resume animal imports, with others in New Mexico and Texas to follow. These changes may influence U.S. feed grain demand dynamics in the weeks ahead.

Export inspection data from the USDA showed 1.37 million tons of corn, 225,000 tons of soybeans, and 435,000 tons of wheat inspected for export last week. Corn volumes are down from the prior week but remain above last year’s levels, while soybean and wheat shipments saw week-over-week improvements.

In Brazil, winter corn harvesting remains behind schedule at 18% completion. Frost and heavy rains in key production zones continue to hamper harvesting efforts and raise questions about grain quality. Mato Grosso leads the progress among states, with Paraná trailing.

Ukraine’s grain export season ended with a 21% decline compared to the previous year, totaling 40.6 million tons. Wheat exports fell by 15%, barley by 8.5%, and corn by 25.6%. The Agrarian Ministry confirmed that spring sowing areas remain consistent with last year, although harvesting is already showing delays and smaller initial volumes.

The European Union concluded a new trade agreement with Ukraine, replacing the temporary tariff-free regime established after Russia’s invasion. The updated deal introduces moderated quotas on sensitive products like wheat and corn while liberalizing trade for non-sensitive items. This could influence intra-European grain flows and pricing.

The U.S. and Italy announced a bilateral initiative to boost soybean trade, forming a new agricultural task force. Italy has begun shifting soybean imports away from other origins like Brazil and Ukraine toward the U.S., as part of broader U.S. efforts to reduce dependency on China.

In India, monsoon-related crop sowing surged. Rice area is up 47% and oilseeds 20% from last year, thanks to rainfall 9% above normal in June. This robust sowing could lead to higher domestic supply, potentially reducing India’s import demand for oilseeds and vegetable oils.

Indonesia increased its reference price for crude palm oil to $877.89/ton for July, while keeping export taxes unchanged. The decision reflects stronger global prices, while export volumes from January to May reached 8.3 million tons. Malaysia’s palm oil exports rose 4.66% month-over-month in June, driven largely by EU demand.

U.S. legislative developments are influencing sentiment in the biofuels market. A new Senate tax bill proposes excluding foreign-sourced feedstocks from renewable fuel tax credits, which could benefit domestic soybean and corn producers. It also seeks to reinstate and double the value of the Small Agri-Biodiesel Producer Credit.

Weather remains a central theme for crop watchers. North America faces persistent heat in the Midwest, with only short-lived cooler periods ahead. South America, particularly Southern Brazil, will continue to experience sharp rainfall deficits. Dryness is also forecast in Southeast Asia, impacting palm oil prospects.

In Argentina, dry and cool weather is boosting optimism for wheat planting, with water reserves said to be comparable to record-yield years. Analysts expect this season to exceed average production if weather conditions hold.

Finally, soybean futures saw significant delivery activity overnight, and open interest surged, indicating strong investor engagement despite mixed signals from export markets and stock levels. Traders remain cautious as macroeconomic and geopolitical factors continue to shape short-term demand and supply projections.