Chicago Futures – Wheat, Corn, Soybeans

Wheat futures weakened on Wednesday as the market finally reacted to Tuesday’s increase in global production. December 2025 CBOT wheat closed at $5.31¼ per bushel, down 5 cents on the day, with SRW leading losses and Kansas City HRW off 3–4 cents while Minneapolis spring wheat was steady to slightly lower. Traders continued to absorb USDA’s higher world wheat stocks on the back of bigger crops in Canada, Australia, Argentina, the EU and Russia, even as US ending stocks stayed at 901 million bushels. The quarterly Flour Milling report showed July–September wheat grind at 231.4 million bushels, above the prior quarter but slightly below last year, while the latest CFTC update indicated managed money cutting its Chicago wheat net short to 58,761 contracts and trimming net shorts in KC as well, signalling some reluctance to press prices much lower near current levels.

Corn gave back part of Tuesday’s rally, with December 2025 CBOT corn settling at $4.34¾ per bushel, down 6 cents as futures faded from post-WASDE highs. The US national cash corn index slipped to $3.99, while EIA data showed ethanol production easing to 1.105 million barrels per day, just below last week’s record, with stocks essentially flat at 22.51 million barrels. NASS Grain Crushings data showed September corn grind at 435.36 million bushels, down versus last year, but October usage at 476.4 million bushels, up 2.8% year-on-year and pushing corn used for ethanol slightly above last season in the first two months of the marketing year. Speculators continued to moderate their bearish stance, cutting another 31,993 contracts from their net short to 39,523 contracts, while export interest was underlined by South Korean purchases of 136,000 tons and a Taiwanese tender for 65,000 tons ahead of Thursday’s catch-up Export Sales report.

Soybeans firmed modestly, with January 2026 CBOT soybeans closing at $10.91¼ per bushel, up 4 cents, even as the national US cash bean index eased to $10.21¾. Soymeal futures were steady to moderately lower, while soyoil edged 7–11 points higher, helped by ongoing strength in the oil leg despite pressure from palm. USDA reported fresh private sales of 136,000 tons of soybeans to China and 119,000 tons to unknown destinations, along with 212,000 tons to unknown already on the books and 120,000 tons of soymeal to Poland, underscoring continued international demand. The delayed NASS Fats & Oils report showed a record October soybean crush of 237 million bushels, up nearly 10% year-on-year, and rising bean-oil stocks at 1.781 billion pounds, while CFTC data revealed funds adding another 15,760 contracts to their net long, taking managed money’s soybean position to a hefty 194,443 contracts as of mid-November.

Global Drivers and Key Headlines

Across the broader commodity complex, the tone on Wednesday was shaped by softer grains, weaker oilseeds and pressure from vegetable oils, with nearby SRW wheat now down 2.8% year-to-date, HRW down 7.0% and corn off 3.9%, while soybeans remain up 8.5% and soyoil up 27.5%. Chinese January futures mirrored this heavy but not panicked backdrop, with soybeans slightly higher but soymeal, soyoil, palm oil and corn all modestly lower, and Malaysian palm oil down 1.05% overnight. CME data showed SRW, HRW, corn and soymeal open interest rising while soybeans and soyoil saw liquidation, underlining a shift in positioning as funds rotate within the complex rather than exit entirely.

Argentina still featured prominently in market thinking after Economy Minister Luis Caputo confirmed that the newly reduced export taxes on soybeans, soy products, corn and wheat are permanent, not temporary. The move, part of President Javier Milei’s drive to dismantle long-standing levies, comes as farmers harvest a huge wheat crop and plant soybeans, and follows years in which heavy intervention left Argentina losing ground to Brazil. By cutting soybean taxes to 24%, soymeal and soyoil to 22.5%, wheat to 7.5% and corn to 8.5%, Buenos Aires is signalling a structural push to revitalise its farm sector and reclaim export share at a time when China is already leaning more on South American origins in the wake of Donald Trump’s trade war.

Weather remained a core driver, with daily updates highlighting a classic La Niña-style pattern. North America faces cold risks in the Northern Plains and Midwest/Northeast, with heavy rains limited to the Pacific Northwest and widespread snowfall elsewhere, while most of the US heartland stays comparatively dry. South America sees the Pampas cool with above-normal rain confined to the south, even as Brazil turns notably wetter and cooler; Europe is set for a week of warmer-than-average temperatures and mostly below-normal precipitation outside the UK, Spain and Scandinavia; and Asia is expected to experience near-normal to cooler temperatures with above-normal rainfall in much of Southeast and East Asia.

Forward-looking climate guidance added another strategic layer as forecasters reiterated that La Niña is likely to fully dissipate between March and May 2026. The outlook flags elevated spring dryness risks for winter and spring crops in the US Midwest and Plains and in Russia, as well as for coffee in Ethiopia and Vietnam, while at the same time raising the odds of excessive moisture or spring flooding in southwest Europe, the North China Plain and Indonesia. These asymmetrical risks are already being folded into new-crop hedging strategies, as they could reshape yield expectations and freight flows for the 2026 harvests even if near-term conditions look broadly manageable.

In Europe, medium-term grain and oilseed supply signals turned slightly less comfortable. Industry group Coceral’s first projection for the 2026 EU+UK grain crop puts output at 296.7 million tons, down 3% from 306.6 million in 2025 as yields normalise from this year’s exceptional levels, with soft wheat seen at 143.9 million tons versus 147.5 million, barley at 58.2 million versus 63.2 million and corn recovering modestly to 58.9 million tons from 57.1 million. Farmers disappointed by recent corn performance are expected to continue cutting corn area, particularly in the Balkans and France, in favour of spring crops such as sunflower and soybeans, while rapeseed production is pegged flat year-on-year at 21.8 million tons, suggesting stable EU oilseed availability.

India’s winter sowing campaign emerged as another key swing factor. Farmers have planted 47.9 million hectares of winter crops since 1 October, up 6.1% from last year, including 24.14 million hectares of wheat (+10.8%), 8 million hectares of rapeseed (+4.5%) and 7.8 million hectares of chickpeas (+3.5%), backed by abundant monsoon rainfall, high reservoir levels and strong soil moisture even in typically rainfed zones. A larger wheat harvest would help cool domestic prices and may eventually allow limited wheat-flour exports, while increased rapeseed output could reduce India’s heavy reliance on imported palm, soyoil and sunflower oil; with La Niña-linked colder-than-normal winter weather forecast for northern India, yields could improve further if conditions remain supportive through mid-March.

China and the US offered a measure of stability on the structural side. For 2026/27, China’s wheat crop is projected at 141.0 million tons, unchanged from the prior estimate, as winter sowing concludes with adequate soil moisture and a seasonal outlook calling for near-normal to slightly warmer temperatures and near-normal precipitation across the main wheat belt—conditions favourable for establishment if realised. In the US, updated farmer-reported data showed prevented plantings virtually unchanged since September and planted area (including failed acres) at 97.244 million acres for corn, 80.303 million for soybeans and 48.886 million for wheat, reaffirming the current balance sheets after acreage reporting was disrupted by the 43-day federal government shutdown.

Vegetable oils delivered one of the biggest headlines of the day as Malaysia’s palm oil stocks surged to a 6½-year high in November. Inventories jumped 13% month-on-month to 2.84 million tons—the highest since March 2019—as exports slumped 28.1% to 1.21 million tons, even though crude palm oil output dipped 5.3% to 1.94 million tons but still marked the strongest November since 2017. With Indonesia cutting its December export tax on crude palm oil to $74 per ton from $124, Malaysia’s shipments are expected to remain under pressure, and total 2025 production is now likely to exceed 20 million tons for the first time, keeping benchmark palm futures pinned near five-month lows and indirectly capping upside in soyoil and rapeseed oil despite robust US crush and strong fund length in the oilseed complex.