Wheat futures ended the session in positive territory, with the May 2025 CBOT wheat contract settling at $5.54 per bushel, up 5 ¾ cents on the day. Chicago SRW futures rose between 5 and 7 cents, while Kansas City HRW and Minneapolis spring wheat posted gains of 8-10 cents and 5-6 cents, respectively. Export sales for the week ending February 27 totaled 338,703 metric tons, a 25.91% increase from the previous week and nearly 25% higher than the same period last year. Mexico and the Philippines were key buyers. Despite this uptick, U.S. wheat exports remain sluggish compared to past years, with January shipments at 1.313 million metric tons, the lowest for the month since 1972.

Corn futures also climbed, with the May 2025 contract closing at $4.64 per bushel, up 8 ¼ cents. The market was supported by stronger-than-expected export sales of 909,050 metric tons, up 15.3% from the previous week. Japan and Mexico were the top buyers, though shipments to unknown destinations saw a net reduction as some purchases were reassigned to specific countries. Additionally, January U.S. corn exports reached 6.162 million metric tons, a 43.34% year-over-year increase, marking a record for the month. Ethanol production remained strong, with plant output at 1.093 million barrels per day, slightly above analyst expectations.

Soybean futures rallied, with the May 2025 contract settling at $10.27 ¼ per bushel, up 15 ½ cents. Soymeal and soyoil futures also posted gains, with soybean meal prices rising between $2 and $5.10 per ton, while soybean oil prices increased 11 to 20 points. Export sales data showed 352,883 metric tons of soybean bookings, with China and Germany leading purchases. However, weekly sales were down 42.5% compared to last year. Census data revealed that January soybean exports totaled 5.21 million metric tons, a five-year low for the month. Meanwhile, private exporters reported a 20,000 metric ton sale of soybean oil to an unknown destination, offering some support to the market.

Key Market Developments and Global Trade Trends

President Trump announced a pause on tariffs related to the USMCA trade agreement, delaying any potential increases on Mexico and Canada for another month. Canada, in turn, postponed its planned tariffs on $125 billion of U.S. goods until April 2. This development temporarily eased trade tensions in North America, supporting market sentiment.

Meanwhile, Russia’s wheat export forecast was revised downward to 40.5 million metric tons, a 1.5 million-ton reduction, due to declining profitability for exporters and lower global wheat prices. February wheat exports from Russia totaled 1.95 million metric tons, the lowest level for the month in five years. Analysts anticipate that March exports could drop further, potentially pushing total Russian wheat exports for the season to just 40-41 million metric tons, far below the USDA’s forecast of 45.5 million metric tons.

In South America, Brazil’s soybean production outlook was lowered by agribusiness consultancy Celeres to 171.6 million metric tons, down from a previous estimate of 174 million tons. This revision reflects the impact of hot and dry weather in key states like Rio Grande do Sul, Mato Grosso do Sul, and Santa Catarina. Despite this cut, Brazil is still projected to produce a record soybean crop, with total output expected to be 11.1% higher than last season. Meanwhile, soybean exports from Brazil are forecast to reach 107 million metric tons, up from 98.8 million metric tons in 2024.

Argentina’s soybean production estimate was also slightly reduced to 49.5 million metric tons, as heavy rains in the Pampas region raised concerns over excessive moisture and potential delays in harvest progress. Local analysts forecast production between 47.3 and 51.7 million metric tons, while the USDA’s latest WASDE report placed Argentina’s soybean output at 49 million metric tons.

In Mexico, the Senate approved a bill banning GMO corn in an effort to protect native corn varieties. This legislation, backed by President Claudia Sheinbaum, promotes the use of traditional crops and prevents the planting of genetically modified corn on Mexican farmland. The move could impact U.S. corn exports to Mexico, a key destination for American corn shipments.

Weather risks continue to influence grain markets. Drought conditions persist across Brazil, with forecasts suggesting that hot and dry weather could continue through mid-March, further affecting second-crop safrinha corn production. In contrast, Argentina’s weather outlook has improved, with rainfall moderating in key growing areas, offering some upside potential for corn and soybean yields.

In the U.S., the Northern Plains are expected to experience scattered showers, but overall dryness remains a concern. Meanwhile, the Midwest is bracing for a storm system that could bring heavy snow and widespread precipitation, impacting transport and logistics. The Central and Southern Plains received beneficial rainfall, providing much-needed relief for winter wheat crops.

Export trends remain mixed. U.S. wheat sales improved but still lag behind historical levels, while France’s wheat exports gained momentum, benefiting from reduced Black Sea shipments. China’s demand for U.S. corn and soybeans continues to weaken, as Brazil solidifies its position as the dominant global supplier.

The U.S. ethanol market showed strength, with ethanol exports reaching a record high for January at 198.05 million gallons. However, U.S. ethanol stocks fell by 1% to 27.289 million barrels, slightly below expectations. Meanwhile, Indonesia’s palm oil exports are forecast to decline by 7% this year, as increased domestic biofuel usage limits overseas shipments.

Investor sentiment remains cautious, with managed money funds reducing long positions in wheat, corn, and soybeans. Market participants are now looking ahead to the upcoming USDA WASDE report and Prospective Plantings report, both of which are expected to provide further clarity on global supply and demand trends.

The grain market ended Thursday with gains across wheat, corn, and soybean futures, driven by improving export sales and easing trade tensions in North America. However, ongoing concerns over Russian wheat exports, South American weather risks, and shifting global demand trends continue to create uncertainty. As traders prepare for key USDA reports, the focus will remain on U.S. trade policy developments, Brazil’s harvest progress, and global weather patterns, all of which are expected to influence price movements in the coming weeks.