Wheat futures opened Friday’s session with the May 2025 CBOT contract at $5.51 ½ per bushel, reflecting modest declines. The wheat market continued to struggle with strong export competition from Russia and Ukraine, as well as concerns over global demand. U.S. wheat export commitments reached 20.484 million metric tons as of February 27, an 11% increase from last year, but still lagging the 97% average pace for this time of year. Japan purchased 94,282 metric tons of wheat from the U.S., Australia, and Canada, with 35,882 metric tons specifically from the U.S. Meanwhile, France reported that 73% of its soft wheat crop was in good or excellent condition, a slight improvement from the previous week.

Corn futures saw modest gains, with the May 2025 contract trading at $4.68 ½ per bushel, up 4 ½ cents during midday trading. Prices were buoyed by the temporary suspension of tariffs on Mexico and Canada, two major buyers of U.S. corn. Total corn export commitments reached 49.567 million metric tons, up 26% year-over-year, representing 80% of USDA’s export forecast. South Korea purchased 131,000 metric tons of corn in a recent tender, adding support to prices. Meanwhile, Brazil exported 1.432 million metric tons of corn in February, down from 1.713 million metric tons last year, highlighting shifting global trade flows.

Soybean futures faced pressure, with the May 2025 contract at $10.23 ¼ per bushel, down 4 cents. China remained a key factor in market movements, with January and February soybean imports totaling 13.61 million metric tons, up 4.4% from last year. However, the recent 10% tariff on U.S. soybeans and the suspension of imports from three major U.S. exporters raised concerns about future demand. Meanwhile, Brazil’s soybean exports were projected at 14.8 million metric tons in March, compared to 13.5 million metric tons last year, further pressuring U.S. prices.

Key Market Developments and Global Trade Trends

Trade policy remained a central market driver, with President Trump delaying new tariffs on Mexico and Canada until April 2, easing concerns about immediate trade disruptions. However, the 25% tariffs on China remain in place, prompting retaliatory measures that continue to impact agricultural exports. Canada and Mexico remain the largest buyers of U.S. corn and wheat, while China continues to shift demand towards Brazil.

Russia signaled that it may limit grain exports if the 2025 harvest underperforms, citing unfavorable weather and logistical concerns. The country’s wheat export quota has already been enforced, and any further restrictions could lead to upward pressure on global wheat prices. Meanwhile, Ukraine’s grain exports have slightly declined year-over-year, but shipments remain steady despite ongoing geopolitical challenges.

Weather continues to play a crucial role in market direction. Argentina experienced heavy rainfall, delaying corn and soybean harvests, while southern Brazil remains dry, raising concerns for safrinha corn production. The latest forecasts suggest that dry conditions in Brazil could persist through mid-March, further impacting supply expectations. In contrast, the Northern Plains of the U.S. remain dry, increasing the risk of early-season drought for wheat and corn planting.

Logistical disruptions also influenced trade, with U.S. barge shipments on the Mississippi River down 41% for corn and 38.2% for soybeans week-over-week. In Argentina, oilseed workers are threatening to strike, which could disrupt soymeal and soyoil exports, adding further uncertainty to supply chains.

The biofuel sector is another factor shaping grain markets. U.S. ethanol stocks rose 5.2% to 27.57 million barrels, raising concerns about a potential oversupply situation. Meanwhile, Brazil is considering reducing import taxes on corn ethanol, a move that could shift trade flows and impact demand for U.S. ethanol exports.

In macroeconomic developments, the U.S. Dollar Index remains weak, making American grain exports more competitive globally. However, persistent inflation concerns and the Federal Reserve’s commitment to keeping interest rates elevated continue to weigh on investor sentiment. Crude oil prices stabilized around $70 per barrel, influencing transportation costs and biofuel margins.

Export trends continue to highlight challenges for U.S. grain markets. France’s wheat exports saw a slight improvement, but competition from Black Sea suppliers remains intense. China’s demand for U.S. corn and soybeans has slowed, with Brazil emerging as the dominant supplier for both commodities.

Investor sentiment remains cautious, with managed money funds reducing long positions in wheat, corn, and soybeans. Traders are closely monitoring the upcoming USDA WASDE report and Prospective Plantings report, both of which could provide further direction for grain prices.

The global grain market remains highly sensitive to trade policy shifts, weather risks, and logistical disruptions. While Trump’s delay on tariffs for Mexico and Canada provided short-term relief, uncertainty remains high as new policies could be implemented after April 2. Meanwhile, China’s tariffs on U.S. agricultural goods, South America’s strong production, and fluctuating global demand continue to create volatility. Traders and analysts are now looking ahead to the USDA reports and further geopolitical developments as key indicators for future price movements.