Wheat futures started Tuesday with slight gains after a strong performance in the previous session. The May 25 CBOT Wheat contract opened at $5.71 ¼ per bushel, up 2 ¾ cents from Monday’s close. The rally continues to be driven by concerns over tightening global wheat supplies, as dry conditions persist across key growing regions in the U.S. Southern Plains and southwestern Russia. The USDA’s latest export inspections showed a notable increase in wheat shipments, with 493,000 metric tons (MT) exported last week, up from 242,000 MT the previous week. South Korea, Japan, and Mexico remained key buyers. However, strong Russian wheat exports continue to weigh on the market, limiting upside potential.
Corn futures opened Tuesday slightly lower, as the market consolidated after Monday’s gains. The May 25 CBOT Corn contract began the day at $4.58 ½ per bushel, down 2 ½ cents from the prior close. Despite short-term weakness, corn futures remain supported by strong export demand. The USDA reported 1.659 million MT of corn shipments last week, marking a 25.06% increase from the same period last year, though 10.06% below the previous week’s total. Mexico, Japan, and Colombia led U.S. corn purchases. In Brazil, 97% of the second corn crop has now been planted, but analysts are monitoring dry conditions in Goiás, Mato Grosso do Sul, and Paraná, which could affect yields in the coming weeks.
Soybeans began Tuesday’s session with moderate gains, reflecting a combination of export demand and supply-side concerns. The May 25 CBOT Soybean contract opened at $10.18 ¼ per bushel, up 2 ¾ cents from Monday’s close. The soybean market remains cautious following weaker-than-expected NOPA crushing data, which revealed that 177.87 million bushels were processed in February—7.6% below expectations and the lowest volume in five months. Export inspections for soybeans came in at 646,667 MT, down 7.7% from last week and 24.2% lower than a year ago. China accounted for 420,243 MT of those shipments, as traders closely watch U.S.-China trade relations ahead of potential new tariffs.
Key Global Market Developments Impacting Grain Prices
Trade tensions between the United States, China, and the European Union remain at the forefront of market concerns. President Donald Trump reaffirmed plans to impose sector-wide tariffs on April 2, including levies on agricultural goods, steel, aluminum, and automobiles. In response, China has halted soybean imports from three major U.S. agricultural entities, further shifting its dependence toward Brazilian soybeans. This move has driven Brazilian soybean export premiums up by 70%, as Chinese crushers scramble to secure supplies.
The European Union has also announced its intent to impose tariffs on $28.2 billion worth of U.S. goods, including soybeans, corn, and beef, as a retaliation against American trade restrictions on European steel and aluminum. The European feed industry has raised concerns that higher input costs could disrupt livestock feed supply chains, leading to increased demand for alternative protein sources, such as rapeseed meal and sunflower seed meal.
China’s import strategy for corn is shifting significantly, with imports from Brazil surging by 84% year-over-year. Analysts fear this trend could have long-term consequences for U.S. corn exporters, particularly as the Biden administration mulls additional tariffs on Chinese technology. Meanwhile, logistical disruptions in Ukraine continue to weigh on Black Sea grain exports, as Russian attacks on agricultural infrastructure raise concerns about global supply availability.
Dry conditions in southwestern Russia remain a key concern for wheat traders. While some precipitation occurred over the weekend, analysts doubt it will be enough to offset the prolonged drought in the region. In the United States, winter wheat conditions are mixed, with the USDA’s latest report showing a decline in Kansas wheat ratings, where 48% of the crop is now rated good-to-excellent, down 4 percentage points from last week. The Southern Plains saw strong winds and wildfires, further stressing moisture levels.
In South America, rainfall is expected to support Argentina’s corn and soybean crops, while dry conditions in Paraguay could negatively impact late-season soybean development. Central-West Brazil is anticipating timely rains, which should aid second-crop corn growth.
Brazil’s soybean harvest is now 70% complete, significantly ahead of last year’s 63% pace. However, Brazilian soybean exports have fallen by 30.4% year-over-year, primarily due to logistical bottlenecks and transportation constraints. Despite the progress in harvest, analysts remain cautious about whether the final production estimate of 167.37 million MT will hold, as some regions continue to battle excess moisture concerns.
U.S. soybean crush volumes fell short of market expectations, with February’s 177.87 million bushels marking an 11.13% decline from January and 4.47% lower than the same month last year. Meanwhile, soybean oil stocks rose 8.8% from January, reaching 1.503 billion pounds, as weak soymeal demand and colder weather disruptions slowed processing activity.
Brazil’s corn stocks remain historically low, with beginning inventories for the 2024/25 season at just 2.04 million metric tons, down from 7.2 million tons in 2023/24. This tight supply situation has driven domestic corn prices close to BRL 90 per 60-kilo bag, a level last seen in April 2022.
Palm oil markets saw significant movement, as Indonesia’s February palm oil exports surged by 62.2%, reaching a four-month high after Jakarta cut export taxes to outcompete Malaysian suppliers. However, the Malaysian palm oil market fell to a four-year low, as India and China favored cheaper Indonesian supplies.
Global fertilizer markets are experiencing increased volatility amid U.S. tariff uncertainty. Potash prices at New Orleans (NOLA) have risen to $310-$315 per short ton, while Corn Belt prices have climbed to $345-$360. Analysts expect continued strong demand for fertilizer as spring planting preparations accelerate.
Market Outlook for Today’s Trading Session
As global trade tensions escalate and weather conditions remain uncertain, the grain markets are likely to experience heightened volatility throughout Tuesday’s session. Traders will closely monitor U.S.-China trade developments, European tariff decisions, and South American crop progress. Key economic data releases today include the USDA export sales report and updated production estimates, which could significantly impact price direction.
With geopolitical risks increasing and global trade flows shifting, traders should prepare for continued price swings across wheat, corn, and soybean markets in the sessions ahead