Wheat

Chicago wheat futures for September 2025 opened Wednesday’s session at $5.09 ½ per bushel, extending modest gains from the previous day before slipping in early trade. Kansas City hard red winter wheat futures weakened by 3 to 4 cents, while Minneapolis spring wheat posted losses of up to 5 ¼ cents. U.S. harvest progress is nearly complete, with winter wheat at 98% and spring wheat 53% harvested, just under the five-year average. Crop ratings fell slightly, with only 49% of the spring crop rated good-to-excellent. Export demand remains robust, with USDA reporting shipments of 946,240 tons last week, led by Indonesia, the Philippines, and South Korea. However, abundant Russian supply continues to weigh heavily on market sentiment, with IKAR raising its harvest forecast to 86 million tons and exports to 43 million tons. The European Commission also noted that EU soft wheat exports have fallen 48% year-on-year to just 2.18 million tons so far this season, highlighting competitive pressures in global trade.

Corn

Corn futures began Wednesday at $3.87 ½ per bushel for the September 2025 contract, down 1 ¾ cents from Tuesday’s close. The USDA’s latest Crop Progress report kept U.S. crop conditions steady at 71% good-to-excellent, though state-level variations showed notable declines in Illinois and Iowa. Export activity remains supportive, with Taiwan confirming a purchase of 65,000 tons of U.S. corn overnight. Cumulative U.S. shipments now stand at 65.5 million tons, 28% above last year. In Brazil, exports are forecast at 7.8 million tons for August, slightly below prior estimates but still substantial as the second corn crop nears completion at 98%. Despite this steady outlook, U.S. traders remain cautious over disease pressures, with southern rust and northern blight continuing to spread in the Midwest, potentially limiting yield potential late in the season.

Soybeans

Soybean futures opened Wednesday at $10.28 ¾ per bushel, up 3 ¼ cents from the prior day. The market remains supported by crop condition improvements, with 69% of fields rated good-to-excellent and pod-setting progress at 89%, alongside 4% dropping leaves. Export inspections for soybeans totaled 382,806 tons last week, down sharply from the previous week, though cumulative exports remain 11.5% above last year at 49.3 million tons. Brazil’s export forecast for August was revised slightly lower to 8.9 million tons, while soymeal exports were cut to 2.13 million tons. Market sentiment was also buoyed by confirmation that a senior Chinese trade envoy will visit Washington this week, raising expectations for progress in U.S.–China trade negotiations. Nonetheless, Brazil continues to dominate Chinese soybean imports, leaving questions about long-term U.S. competitiveness.

Global Market Drivers

Indonesia confirmed that the U.S. has agreed in principle to exempt its palm oil, cocoa, and rubber exports from the 19% tariffs imposed earlier this month, signaling a potential breakthrough in trade ties. The talks also included discussions on U.S. investment in Indonesia’s fuel storage and industrial parks, highlighting the growing link between commodity flows and geopolitical negotiations.

In South America, Brazil’s grain sector faces financial strains despite record production estimates of 176.5 million tons of soybeans and 138.4 million tons of corn for 2025/26. Rising loan defaults and tightening credit conditions are slowing fertilizer purchases, potentially undermining future productivity. At the same time, a federal court suspended antitrust regulator CADE’s order against the soy moratorium, preserving restrictions on soy purchases tied to Amazon deforestation—an outcome welcomed by crushers and environmental groups.

Argentina remains under weather stress, with forecasts calling for heavy rains exceeding 100 mm across Cordoba’s wheat areas later this week, raising risks of flooding and disease. Frost damage earlier in August has already reduced confidence in crop potential. Still, trade flows are showing signs of stabilization, with soybean meal exports to China slowly resuming.

Across Europe, the EU’s MARS unit trimmed corn yield forecasts due to drought and heat in Romania, Bulgaria, Greece, and southern Ukraine. While conditions remain favorable in northern France, Germany, Spain, and Poland, sharp yield losses in southeastern regions highlight uneven growing conditions.

In the Black Sea, Ukraine’s 2025 wheat harvest is pegged at a maximum of 21.8 million tons, down from 22.7 million last year, while corn output is seen between 28 and 29 million tons. Traders report falling milling wheat prices, reflecting weak demand and intense competition with Russia in North Africa. Meanwhile, Kazakhstan’s wheat outlook was reduced to 16.3 million tons due to lower sown area, while favorable weather conditions may aid yields in the northern oblasts despite potential delays from expected heavy rainfall.

Australia also entered the spotlight, with analysts lifting wheat harvest forecasts to as high as 35 million tons, supported by timely rains in July and August. This would put Australia in a position to add significantly to global wheat supplies, particularly as unexported stocks from last season are carried over, pressuring international prices further.

Weather patterns across the globe remain crucial. The U.S. Midwest faces a cooler and drier stretch, likely curbing late-season development for corn and soybeans. Canada braces for a heatwave in the western Prairies after a recent cold spell, while Europe expects widespread showers to benefit late corn and prime soils for wheat planting. South Asia continues to see heavy rains in India’s Maharashtra region, raising flood risks, while tropical storms Fernand and Juliette pose no land threat but keep markets alert to possible disruptions.

Trade logistics and protein markets added further complexity. U.S. barge shipments along the Mississippi fell to 667,000 tons from 853,000 the previous week, with soybean volumes plunging 36%. In the protein sector, U.S. poultry slaughter rose 1.6% year-on-year in July, while Brazil’s poultry exports remain constrained by avian flu restrictions. These dynamics continue to feed back into global grain demand, reflecting the tight interplay between livestock markets and feed grain consumption.