Policy and Trade Developments

Argentina dominated headlines early in the week by suspending export taxes on grains, oilseeds, and by-products in an urgent attempt to attract foreign currency and bolster reserves ahead of key elections. The temporary measure, originally set to last until October 31 or until $7 billion in declared exports was reached, prompted a flood of forward sales. Within two days, the cap was met, forcing Buenos Aires to reinstate levies. In the meantime, farmers sold nearly 1.2 MMT of soybeans in a single day, and Chinese buyers locked in at least 20 cargoes for November–January, volumes that usually fall to U.S. suppliers. The abrupt reinstatement of taxes created a whiplash effect, destabilizing forward trade expectations and reshaping South American flows almost overnight.

The ripple effects extended beyond soybeans. Brazil’s wheat imports from Argentina surged to multi-year highs through August, weighing on domestic prices near import parity and underscoring how Argentina’s shifting tax stance can unsettle balances not only in soy but also in cereals across the region. For global trade, this means increased uncertainty around South American export availability and price competitiveness moving into Q4.

China intensified its strategic pivot. Instead of engaging U.S. suppliers during the prime Q4 window, Beijing leaned heavily into Argentine and Brazilian soybeans, leaving U.S. new-crop export commitments at historically low levels. This behavior, unprecedented in USDA records, effectively restructured trans-Pacific trade dynamics. Beyond soybeans, China signaled it wants removal of “unreasonable tariffs” as a condition for expanded two-way trade with the U.S., while highlighting a strong domestic autumn grain harvest already 20% complete. Officials attributed over 63% of yield gains to advances in ag technology, suggesting long-term ambitions to trim import dependency.

Trade frictions weren’t limited to the Americas. Thailand announced a landmark ban on imports of animal-feed corn sourced from burned fields, effective January 1, 2026. The move, framed as an environmental and health measure to curb smog, directly targets Myanmar, Laos, and Cambodia, which collectively supply millions of tonnes annually. By shifting sourcing toward the U.S. and WTO-compliant origins, Thailand is poised to alter regional demand patterns and potentially lift U.S. corn export prospects in Southeast Asia.

The Black Sea remained another focal point. Russia’s consultancy IKAR lifted its wheat production forecast to 87.5 MMT with export potential of 44.1 MMT, reinforcing Moscow’s dominance in global tenders. Meanwhile, Ukraine’s wartime logistics constraints continued to limit flows, keeping buyers like Algeria and South Korea more open to U.S. and South American origins. Europe’s export pace, at just over 4.1 MMT since July 1, lagged last year significantly, leaving EU suppliers struggling to compete.

Beyond bilateral flows, global trade architecture shifted in subtle but important ways. Canada and Indonesia inked a new pact lowering trade barriers and easing investment conditions, opening lanes for palm oil, grains, and processed foods. In Washington, policymakers hinted at a farmer-relief package that could arrive within weeks, designed to stabilize income and influence acreage decisions for the 2026 crop cycle. At the same time, Brazil faced governance pressures as its antitrust tribunal prepared to vote on the soy moratorium appeal—a decades-old agreement seen as pivotal for curbing Amazon deforestation. Depending on the outcome, compliance rules for crushers and traders could be reshaped, with ripple effects across ESG-driven demand and EU deforestation regulation.

Price Movements and Futures Trends

Wheat markets fluctuated under the weight of global supply competition and tender demand. Chicago SRW December ’25 futures opened Thursday at $5.19½/bu, down marginally on the day, with Kansas City and Minneapolis mixed. Algeria and South Korea tenders offered a floor, but Russian and Australian supply projections kept wheat values competitive. EU soft wheat exports since July 1 remained sluggish at 4.12 MMT, well below last year’s pace, reflecting logistical and demand challenges.

Corn traded defensively as bearish ethanol data overshadowed export optimism. December ’25 corn began Thursday at $4.24¼/bu, slipping despite fresh USDA flashes to Mexico and steady inspections. U.S. ethanol output fell to 1.024 mbpd while stocks surged to 23.468 million bbl, a 3.8% weekly increase that pressured near-term corn grind sentiment. Brazil’s ANEC raised September corn export projections to 7.61 MMT, while South Korea tendered for 140,000 MT, highlighting ongoing international demand despite U.S. softness.

Soybeans struggled to hold intraday strength, with November ’25 futures opening at $10.09/bu before easing lower. Soymeal lost ground and soyoil tracked palm oil volatility, with Malaysian contracts climbing toward 4,444 ringgit. The standout driver was China’s purchase of up to 20 Argentine cargoes, effectively sidelining U.S. new-crop beans. Domestically, U.S. harvest advanced to 9% complete, broadly seasonal, while USDA confirmed a 101,400 MT soymeal sale to Guatemala. Brazilian exporters trimmed September soybean export expectations slightly to 7.15 MMT, signaling a balanced but competitive outlook.

Weather and Crop Conditions

Weather patterns were a defining factor this week, shaping short-term harvest progress and long-term planting prospects. In the U.S., the Northern Plains enjoyed warmth and dryness, ideal for early harvesting, while the Central and Southern Plains benefited from rains that aided winter wheat establishment but slowed corn and soybean cutting. The Midwest saw rains give way to drier conditions, paving the way for fieldwork. In the Delta, temporary rains lifted river levels, though low-water risks loom for October.

In South America, Brazil’s Mato Grosso to Minas Gerais corridor experienced stalled fronts that provided patchy planting moisture. The outlook for central Brazil remained uneven, raising concerns about soybean sowing momentum. Southern Brazil and Argentina, however, enjoyed favorable rainfall, supporting corn planting and upcoming soybean sowing. Argentina’s favorable soils and another front expected late in the week added optimism for early crop development.

Elsewhere, the Black Sea region remained under drought stress despite scattered showers, while Russia’s agriculture ministry reaffirmed a robust 135 MMT grain harvest. A Reuters poll projected Australia’s third-largest wheat crop at 35.3 MMT and record barley at 14.7 MMT, though localized frosts remained a concern. In Europe, heavy rains in France contrasted with dryness in Spain, underscoring uneven conditions for winter wheat establishment.

Broader Macro Signals

Macro-level policy and market architecture added further texture to the week’s trading landscape. The U.S. administration floated a new farmer relief package, potentially cushioning acreage and marketing decisions heading into 2026. Simultaneously, political tensions between Washington and Brasília escalated, with deforestation concerns prompting a U.S. trade probe and diplomatic visits to the Amazon. Brazil’s crushers continued to expand capacity, with Abiove reporting a 5.7% year-on-year increase to 76.4 MMT, fueled by biodiesel demand.

Positioning data reflected fresh risk-taking rather than simple short covering. Into midweek, open interest showed SRW and HRW wheat net declines, corn contracts falling by over 5,800, and soybeans gaining nearly 3,000 contracts alongside strong increases in soymeal and soyoil. This rotation highlighted speculative shifts toward oilseeds and product markets, even as grains faced competitive headwinds.

The week underscored how quickly global grain markets can be reshaped by intersecting factors: Argentina’s rapid-fire tax policy shifts, China’s calculated rerouting of soybean flows, U.S. ethanol stock surges, and weather-driven dynamics across key producing regions. Futures reflected this turbulence, with wheat capped by global competition, corn pressured by energy data, and soybeans undercut by South American supply.

Heading into October, markets will closely track Argentina’s policy execution, Brazil’s planting momentum, U.S. harvest progress, and China’s import behavior. Together, these variables will define price direction and trade flows in the final quarter of 2025 and set the tone for the 2026 crop cycle.