Key Policies and Global Trade Flows

This week, attention was centered on the strategic decisions of major buyers and exporters, which are redrawing trade flows. Egypt took the spotlight with the purchase of at least 200,000 tons of French wheat, with traders suggesting the actual volume exceeded 400,000 tons. The deal reflects Cairo’s urgent need after weak domestic procurement and limited availability from Russia. It also confirms North Africa’s continuing role as a strategic hub of global demand.

China marked another important shift, returning to the Australian canola market for the first time since 2020, with a 50,000-ton purchase via state-owned COFCO. This decision came after steep tariffs were imposed on Canadian canola and signals a diversification of imports. More Australian deals are expected, which will increase pressure on competitors from Canada and the EU and shift the global balance in oilseeds. At the same time, India purchased canola oil for the first time in nearly five years, due to high domestic prices—another signal of shifting consumption patterns across Asia.

In South America, Brazil was in the spotlight on two fronts. First, the antitrust authority Cade launched an investigation into major soybean traders, accusing them of cartel practices and manipulation in the framework of the “soy moratorium.” Any potential disruption of this sustainability model would have global consequences, as Europe and Asia are heavily dependent on Brazilian soybeans. Second, the country faced financial strain in the agribusiness sector—Banco do Brasil reported record levels of non-performing loans among soybean, corn, and beef producers. High interest rates and rising costs are raising concerns over farmers’ liquidity despite expected record harvests.

In Peru, the government announced sweeping tax reforms for agribusiness—corporate tax for large exporters was cut to 15%, while small companies are fully exempt. The goal is to attract $24 billion in irrigation investments by 2050 and to reduce dependence on mining by boosting agricultural exports. Already-growing shipments of blueberries, grapes, and avocados confirm Peru’s place as a rising global supplier, with India identified as the next strategic destination.

Proteins and biofuels also exerted significant influence, contributing to structural demand for grains. In Brazil, the poultry sector faced export bans due to bird flu, most notably from China, which reduced export volumes. At the same time, however, egg exports are expected to surge by 117% in 2025, driven by strong U.S. demand. In the U.S., the bioethanol sector also came into focus, as Washington launched an investigation into Brazil’s 18% tariff on U.S. ethanol imports. Potential escalation could redirect corn demand into biofuels and create new trade tensions.

Price Trends and Futures Movement

Grain markets in Chicago went through a dynamic week with visible fluctuations, reflecting the tension between record harvest forecasts and strong export flows on the one hand, and adverse weather and logistical challenges on the other. Wheat futures started the week around $5.02–$5.06 per bushel (September 2025 contract), moving with small corrections up and down during the days. Despite Russia’s large harvest and competitive export offers, the market found support in concerns about wheat quality in Germany due to excessive rains and in drought conditions in southwestern Russia limiting spring wheat potential.

Corn initially carried a weaker tone, with quotes dropping to $3.79 ½, but by the end of the week, results from the Crop Tour and strong weekly export data pushed prices higher. On Friday, contracts rebounded sharply to $3.87 ¼ per bushel, supported by exceptionally high yield estimates in Iowa and Minnesota, as well as new sales to Mexico and unknown destinations.

Soybean futures showed the most strength during the week. They traded around $10.11–$10.20 in the first days, but after the release of historically high pod counts in Illinois and Iowa, prices jumped to $10.34 ½. USDA confirmed new export deals with Mexico, Spain, and unknown buyers for more than 1.1 million tons—the largest weekly sale since January.

Impact of Weather Conditions

Weather played a significant role in market dynamics throughout the week. In the U.S., warm and humid conditions supported the development of late corn and soybeans but simultaneously led to the spread of diseases such as southern rust in corn and sudden death syndrome in soybeans. This raises concerns that part of the record potential observed in the Crop Tour could be reduced.

In Canada, heavy rains and the risk of early frosts delayed harvest progress. In Europe, persistent rains in Germany raised questions about wheat protein quality, even though DBV raised its harvest forecast to 43.5 million tons. In Russia, despite record yields in Siberia and the Urals, drought in southwestern regions threatens spring wheat quality and could limit export potential.

Argentina received rainfall that improved soil moisture and raised expectations for record corn planting areas (7.8 million hectares), which would mark the second-largest in history. In Brazil, precipitation was largely neutral for crops, while in India, the monsoon brought excessive rains that increased flood risks in western states, threatening local agricultural activity.

The Black Sea Grain Market: Weekly Highlights

Over the past week, the Black Sea region once again stood at the center of global grain markets, as key developments and weather challenges shaped both trade flows and expectations for upcoming harvests.

Egypt, one of the world’s largest wheat importers, made significant purchases of French wheat through its state buyer, Future of Egypt, with contracts covering at least 200,000 tons. Traders, however, estimate that the real volume may exceed 400,000 tons. At the same time, several smaller deals were struck for Ukrainian and Romanian wheat. These purchases come at a time when Russia is limiting sales from the new crop due to farmer stockholding, while Egypt failed to meet its domestic procurement targets of 4–5 million tons for the season. Prices for purchased wheat ranged between $265–275 per ton c&f, with deferred delivery terms highlighting logistical challenges.

In Bulgaria, the week was marked by two key developments. On one hand, the country launched its 2025 corn harvest, but early results were concerning – yields were down 34.4% compared to the same stage last year, averaging just 200 kilograms per decare. Sunflower harvests showed slight improvements compared to the previous week, but yields remain 2.4% below last year’s levels. In contrast, wheat and barley delivered strong results – 7.3 million tons (+2.3%) and 1.1 million tons (+4.8%) respectively – while rapeseed also posted a 13.7% increase compared to last year.

Another important factor for Bulgaria was the fuel supply crisis caused by a shortage of Ukrainian bioethanol, a mandatory additive for gasoline under EU regulations. Some gas stations were temporarily forced to suspend sales of A-95 gasoline, due to a combination of limited Ukrainian supplies, the closure of a Hungarian processing plant, and increased demand. Despite the strain, experts reassured that the shortage is temporary and does not significantly affect final fuel prices.

Crop Tour Results and Price Impact

The ProFarmer Crop Tour was the main market catalyst during the week. Measurements showed historically record results: in Minnesota, corn yields reached 202.86 bushels per acre, while in Iowa they came in at 198.43 bushels per acre – the highest since the tour began. For soybeans, Illinois reported a record 1,479 pods per 3x3-foot square, while Iowa reached 1,384, far above average. These figures pushed corn and soybean prices higher, though markets remained cautious due to disease threats and the critical weeks still ahead before harvest.

International Forecasts and Balance Sheets

The International Grains Council (IGC) revised its 2025/26 projections upward. Global corn production is now estimated at 1.299 billion tons, with stocks of 294 million tons. Soybean production is forecast at 430 million tons with stocks of 85 million tons. Wheat remains steady at 811 million tons, but stocks are reduced to 264 million tons due to rising consumption. Overall, global grain stocks for the new crop year are projected at 597 million tons, highlighting the balance between record supply and strong demand.

Export Flows and Logistics

The week brought record new sales of U.S. corn – 2.86 million tons, nearly 40% higher than the previous week, while soybeans hit 1.143 million tons, the largest weekly sales since January. Wheat exports, however, weakened to 519,000 tons, a five-week low. U.S. shipments totaled 395,000 tons, down 4.7% from the prior week but still above last year’s levels.

Logistics remain a critical factor. USDA reported Mississippi River barge shipments fell to 667,000 tons from 853,000 tons the previous week. Soybean shipments dropped by 36%, while barge rates in St. Louis rose to $18.51 per ton, reflecting strain in the transportation system.

The week closed with contrasting signals: record U.S. production results and upward global crop forecasts on one side, and risks from crop diseases, unfavorable weather, and trade tensions on the other. Egypt’s wheat deals and China’s return to Australian canola reinforced the urgency of securing supplies. The market remains extremely sensitive to new developments – whether related to weather, policies, or logistics – as the balance between abundant supply and unpredictable demand will shape price dynamics in the weeks ahead.