With US strikes on Iran declared complete and energy prices retreating, the complex surrenders Wednesday's risk-driven gains just hours before the USDA's monthly supply-and-demand update resets the fundamental narrative.

The grain complex opens Thursday lower across the board, with markets digesting the announcement that targeted US strikes against Iran have been completed and that geopolitical tensions, while still elevated, are no longer escalating. The reversal unwinds much of Wednesday's risk-premium rally ahead of a data-heavy morning: weekly Export Sales are due at 7:30 AM CST, followed by the USDA Crop Production and WASDE reports at 11:00 AM CDT. CONAB's updated Brazilian production estimate, released this morning, and BAGE harvest progress data from Argentina later today add additional layers of supply-side information that the market must absorb before positioning into the WASDE.

Geopolitical Risk Premium Unwinds as US Strikes on Iran Declared Complete

The Trump administration announced overnight that targeted strikes against Iran have been completed, removing the acute escalation narrative that drove Wednesday's broad-based grain rally. Crude oil reversed sharply in response, with spot WTI down $1.05/barrel to near $89, RBOB off 2 cents/gallon, and heating oil 5 cents lower. The energy pullback is directly negative for soy oil via the biofuel margin linkage and removes the generalised risk-on sentiment that had supported all three crops. Tensions in the region remain described as elevated, which prevents a full unwinding of the geopolitical premium, but the market is clearly repricing the probability of further immediate supply disruptions downward.

USDA WASDE at 11:00 AM: Market Expects Modest Tightening in Corn, Steady Soybeans

The session's primary catalyst is the 11:00 AM CDT WASDE release. For corn, a Bloomberg survey of analysts looks for a 6 million bushel cut to old crop US carryout to 2.136 billion bushels, with new crop seen at 1.947 billion bushels — a 10 million bushel reduction if realised. The source analyst expects old crop ending stocks unchanged at 2.142 billion bushels, with a 25 million bushel increase in exports offset by lower ethanol usage, producing a slightly more constructive number than the trade average. For soybeans, the Bloomberg survey projects old crop carryout steady at 339 million bushels versus 340 million in May, with new crop unchanged at 310 million bushels — a largely neutral result that is unlikely to be a market-moving event in itself. For wheat, old crop ending stocks are seen at 941 million bushels, up 6 million bushels from May, with new crop carryout at 764 million bushels, a modest 2 million bushel increase.

Wheat Crop Production Report: 8 Million Bushel Cut Expected in Winter Wheat

The USDA Crop Production report, also at 11:00 AM CDT, is the more consequential update for wheat specifically. The Bloomberg analyst average targets total US wheat production at 1.555 billion bushels, with winter wheat at 1.04 billion bushels — an 8 million bushel reduction from May. HRW is expected down 7 million bushels to 508 million bushels, while SRW is seen up 1 million bushel to 302 million bushels. The source analyst's own model is aligned at 1.553 billion bushels, also 8 million below the May figure. Given that US winter wheat conditions are at a 20-year low and pre-harvest rains are ongoing across the Southern Plains, any realisation of this cut — or a deeper one — would be fundamentally supportive for KC HRW, which is currently hovering near its 100-day moving average at $6.26½.

CONAB Raises Brazilian Corn Output; Argentina Gap Persists

CONAB released its updated Brazilian corn production estimate this morning, pegging the 2025/26 crop at 140.46 MMT, up 0.29 MMT from last month. The first crop was raised 0.88 MMT to 28.46 MMT, while the second crop was trimmed 0.58 MMT to 107.87 MMT. The Bloomberg survey average for Brazil is 135.8 MMT, making the CONAB figure more bullish on production than the trade consensus. The Rosario Grains Exchange continues to hold its Argentine corn production estimate at 68 MMT, well above the USDA's 59 MMT estimate, with harvest at 55% complete — a significant divergence that the WASDE may begin to narrow later today. For soybeans, CONAB raised Brazilian production by 0.12 MMT to 180.25 MMT for 2025/26, while the Rosario Grains Exchange lifted its Argentine soybean estimate 1.5 MMT to 51.5 MMT versus the USDA's 48 MMT forecast, with Argentine harvest 96% complete.

EIA Ethanol Data: Production Steady but Still Below USDA Demand Pace

EIA's weekly update showed ethanol production at 1.108 million barrels per day in the week ending June 5, steady with the prior week. The source notes this figure was down 1% year-over-year and that production has been running below the pace needed to meet the USDA's full-year corn usage estimate — this is now described as an eighth consecutive week below the required pace. Ethanol stocks fell 154,000 barrels to 24.452 million barrels, refiner ethanol inputs rose 8,000 bpd to 907,000 bpd, and exports rose 20,000 bpd to 155,000 bpd. The persistent production shortfall against the USDA demand assumption is a factor the analyst expects to appear in Thursday's WASDE as lower corn-for-ethanol usage, partially offset by improved export demand — producing a net-neutral to modestly tighter old crop balance.

Export Sales Due at 7:30 AM: Wheat Sees Possible Net Reductions

The weekly FAS Export Sales report is due before the WASDE. For wheat, traders are looking for net reductions of 100,000 MT to sales of 100,000 MT for the final half-week of the 2025/26 marketing year, with new crop expected in a range of 200,000 to 600,000 MT for the week ending June 4. For corn, old crop business is expected between 0.7 and 1.6 MMT, with new crop in a range of 200,000 to 500,000 MT. For soybeans, the expected range is 150,000 to 400,000 MT old crop and 100,000 to 350,000 MT new crop, with soymeal between 150,000 and 600,000 MT combined across both years. Any result at the low end of the wheat range — or a net reduction — would confirm the structural demand deficit that has been a persistent bearish overhang on CBOT SRW.

EU and UK Wheat Crop Estimates Raised; Black Sea Risk Lingers

Coceral estimates the EU and UK combined wheat crop at 143.7 MMT for this year, up 1.1 MMT from the prior projection. Expana's estimate is lower at 129.2 MMT but also up 0.4 MMT from last month. Both revisions add to the global supply picture at a time when Chicago wheat is already carrying a large speculative short. The upward EU revisions are a moderate bearish offset to the supportive US crop condition story. The Black Sea terminal damage story from Wednesday — Ukraine's UAC reporting extensive damage from Russian missile strikes — has not been followed up with updated logistics data in Thursday's source, meaning the physical export disruption risk flagged yesterday remains unquantified and is a background supportive factor for the session.

US Midwest Rains Continue; Argentina Dryness Aids Corn Harvest

Heavy rains continue to impact the central and northern Midwest, with the heaviest amounts in the past 24 hours concentrated in northern Missouri, central Illinois, and Wisconsin. Precipitation is forecast to continue favouring the central and southern Midwest over the next four to five days before cooler and drier conditions arrive next week. In South America, heavy rains across the interior south of Brazil are benefiting the late second-crop corn but slowing early harvest progress — a weather pattern that could affect the timing of Brazilian export availability and provide modest logistical support to US origin competitiveness in the near term. Argentina's dry conditions are continuing to support corn harvest progress, with the Rosario Grains Exchange estimating 55% of the crop cut.

Wheat

Jul '26 CBOT SRW wheat is trading at $5.84½ at the start of Thursday's session, down 3 cents, with Wednesday's close at $5.87½, up 2¼ cents. KC HRW July is at $6.26½, down 4 cents and hovering near its 100-day moving average. MPLS spring wheat July is unchanged at $6.18½. The pullback reflects the unwinding of Wednesday's geopolitical premium following the US announcement that strikes on Iran are complete. The market is positioned cautiously into the 11:00 AM WASDE and Crop Production reports, where an 8 million bushel cut to winter wheat production is the consensus expectation — any deeper reduction or surprise in the balance sheet could trigger a sharp short-covering response given the historically large fund short still in the market.

Corn

Jul '26 CBOT corn is trading at $4.16½ at the start of Thursday's session, down 2½ cents, with Dec '26 at $4.44¾, down 2 cents. Wednesday's close was $4.19, down ½ cent; the CmdtyView national average cash corn price was steady at $3.86¼. Support for July remains near $4.05 with resistance at $4.41. The morning weakness reflects both the energy price pullback and a broadly cautious pre-WASDE tone. CONAB's Brazilian corn estimate of 140.46 MMT — above the Bloomberg trade average of 135.8 MMT — adds a modest bearish supply signal. Export Sales data due at 7:30 AM, with the trade expecting 0.7 to 1.6 MMT of old crop business, will be the first read of the morning before the more consequential WASDE at 11:00 AM.

Soybeans

Jul '26 CBOT soybeans are trading at $11.20 at the start of Thursday's session, down 3 cents, with Nov '26 unchanged at $11.38½. Wednesday's close was $11.23, up 9¼ cents; the CmdtyView national average cash bean price closed at $10.68½. Jul '26 soymeal is up $1.50 at $303.40 and Jul '26 soy oil is down 23 points at 75.10, with crush margins rebounding 3½ cents overnight to $3.73½/bu. The soybean complex is trading within Wednesday's range, with prices steady on the WASDE expectation of unchanged old crop carryout near 340 million bushels. The Rosario Grains Exchange raising its Argentine soybean estimate 1.5 MMT to 51.5 MMT versus the USDA's 48 MMT forecast, combined with record Brazilian export projections from ANEC, keeps the supply-side pressure intact ahead of today's data.