Wheat futures are showing some strength at the start of Thursday’s session after posting losses in the previous trading day. Chicago SRW futures are up 3 1/4 cents in early trade, recovering from a 2 3/4-cent decline in Wednesday’s session, which saw weakness across all three wheat exchanges. Kansas City HRW futures also saw minor losses yesterday but are showing a 6-cent gain in early trade. The wheat market continues to be influenced by global export tenders, including a recent purchase by Algeria and new tenders from Saudi Arabia and Taiwan. The EU’s Strategie Grains raised its estimate for European wheat production, which could add some pressure to prices, while weather concerns in the U.S. and Ukraine remain a factor.

Corn futures have started Thursday’s session with losses of 2 to 4 1/4 cents, pulling back after Wednesday’s gains of 3 to 6 1/4 cents. The March 25 contract is currently trading at $4.90 1/4 per bushel, reflecting the market’s reaction to mixed production and export developments. The USDA’s weekly Export Sales report, expected later today, is projected to show between 0.8-1.7 million metric tons in sales for the 2024/25 marketing year. Brazil’s CONAB has increased its corn production estimate to 122.01 MMT, while Argentina’s Rosario Grains Exchange cut its estimate to 46 MMT, a 2 MMT decline. Meanwhile, an Algerian tender for 240,000 MT of corn and a South Korean purchase of 132,000 MT highlight ongoing international demand.

Soybean futures are trading slightly lower as the session begins, with contracts down 1 to 2 1/4 cents. The March 25 contract is at $10.27 3/4 per bushel, following Wednesday’s sharp declines of 11 to 16 cents across contracts. The national front-month cash soybean price is at $9.66 1/4, reflecting ongoing pressure in the market. The USDA’s Export Sales report today is expected to show between 300,000-800,000 MT of soybean sales for old crop and up to 50,000 MT for new crop business. Brazil’s CONAB slightly reduced its soybean production estimate to 166.01 MMT, while Argentina’s Rosario Grains Exchange cut its forecast to 47.5 MMT. With Brazil’s harvest delayed and weather conditions varying across South America, the market remains focused on production risks.

The global grain market is absorbing several key developments that could impact trade flows and price movements. In Brazil, the ongoing soybean and corn harvest is influencing diesel demand, with the IEA reporting a significant increase due to the energy-intensive nature of farming. This higher fuel consumption could have broader implications for agricultural costs and transportation logistics. Meanwhile, the Brazilian soybean harvest remains behind schedule, raising concerns about planting delays for the second corn crop. The latest reports indicate that only 14.8% of soybeans have been harvested nationally, compared to 20.9% last year. Mato Grosso and São Paulo are among the most affected regions, increasing the risk of late safrinha corn planting and potential yield reductions.

In Argentina, weather remains a significant factor, with recent heavy rains bringing some relief to drought-stressed crops but also raising uncertainty about final yield outcomes. The Rosario Grains Exchange has already cut its soybean and corn production estimates, and further weather disruptions could lead to additional downward revisions. Argentina’s government has also voided a key dredging auction for the Parana River, a critical export route, citing irregularities in the bidding process. Any prolonged delay in resolving this issue could disrupt grain exports and impact global supply chains.

In the U.S., cold weather in the Northern and Central Plains continues to pose risks for winter wheat. While snow cover could provide some protection, temperature swings could add stress to uncovered crops. The Midwest is also facing an active weather pattern, with multiple storm systems expected to bring heavy precipitation, including freezing rain and snow. These conditions could affect logistics and transportation, further influencing the grain market.

On the export front, Algeria has purchased between 360,000 and 400,000 MT of wheat, while Saudi Arabia has issued a new tender for 595,000 MT, with offers due on Friday. Taiwan has also entered the market, seeking to buy 102,450 MT of U.S. wheat, with a deadline set for next Thursday. Japan’s weekly tender includes 123,979 MT from the U.S., Australia, and Canada, with 34,026 MT specifically from the U.S. These tenders reflect ongoing international demand and could help support wheat prices.

The European wheat market is also experiencing shifts, with Strategie Grains increasing its forecast for EU wheat production to 127.7 MMT, up 0.5 MMT from its previous estimate. This adjustment could add supply-side pressure, though global demand remains strong. Meanwhile, FranceAgriMer has kept its French wheat export outlook steady at 9.74 million tons for the 2024/25 season but has cut stockpile projections slightly.

U.S. ethanol production saw a decline last week, with output falling by 30,000 barrels per day to 1.082 million bpd. Ethanol stocks also dropped by 720,000 barrels to 25.692 million barrels, below market expectations. This could have implications for corn demand, particularly as traders assess the balance between domestic ethanol consumption and export opportunities.

The grain market also remains attuned to geopolitical developments. A conversation between former President Donald Trump and Russian President Vladimir Putin on Wednesday raised speculation about potential negotiations to resolve the conflict in Ukraine. Any developments in this area could have significant implications for Black Sea grain exports, particularly as Ukrainian winter crop conditions remain favorable, according to the country’s state weather forecaster.

As the trading day unfolds, market participants will be closely watching export sales data from the USDA, ongoing weather developments in South America and the U.S., and international trade activity. With multiple factors influencing supply and demand, price volatility is expected to remain a key feature of the market.