May 2025 Chicago SRW Wheat futures opened Wednesday’s session at $5.40½ per bushel, down 2¾ cents from Tuesday’s close. Wheat markets continued to face downward pressure, extending losses from earlier in the week. Tuesday’s session closed with May wheat at $5.43¼, down 5 cents, as easing tensions in the Black Sea and improved U.S. crop conditions in Kansas and Texas weighed on prices. Meanwhile, Russian consultancy SovEcon cut its 2024/25 wheat export forecast by 1.5 MMT to 40.7 MMT due to sluggish shipments and poor margins but raised its 2025/26 forecast slightly. European Union soft wheat exports, at 15.46 MMT so far this season, remain significantly below last year's 23.75 MMT. Japan entered the market with a new tender for nearly 120,000 MT of wheat, including 59,751 MT from the U.S., while Taiwan continues to seek U.S. origin wheat through recent tenders.

Chicago May 2025 Corn began Wednesday’s trade at $4.58¼ per bushel, up ½ cent from Tuesday’s close of $4.57¾, which marked a 6¾ cent decline on the day. The corn market is tracking wheat's weakness but found slight support from international interest. A Taiwanese buyer secured 65,000 MT of U.S. corn, while a South Korean importer tendered for an additional 280,000 MT. Despite geopolitical relief, the USDA reported strong weekly export inspections at 1.463 MMT, led by Mexico, Japan, and South Korea. U.S. national average cash corn fell to $4.23¾. Meanwhile, Brazil's summer corn harvest is now 77% complete, and AgRural lifted its total crop forecast to 121.8 MMT. U.S. early planting is progressing, with Louisiana at 65% and Texas at 45%. Traders also anticipate today’s EIA ethanol report and Monday’s USDA acreage estimates, with Bloomberg forecasting 94.4 million acres of corn for 2025.

May 2025 Soybean futures opened Wednesday at $10.03¾ per bushel, up 2 cents from Tuesday’s close of $10.01¾, which had slipped 5½ cents. Soybeans traded mixed on Tuesday, but soyoil futures posted modest gains between 15 and 34 points, helping cushion some of the losses. Cash soybean prices declined to $9.41, while soymeal dropped up to $2.70/ton. U.S. weekly export inspections were strong at 822,214 MT, with China receiving nearly half (405,000 MT). Brazil’s harvest reached 77%, and AgRural kept its output forecast unchanged at 165.9 MMT, despite disappointing yields in Rio Grande do Sul. EU soybean imports reached 9.84 MMT since July 1, surpassing last year's 9.23 MMT. Traders are closely watching Monday’s USDA soybean planting forecast, with Bloomberg estimating 83.8 million acres for 2025.

Key Global Market Drivers and Headlines

Russia and Ukraine agreed to resume safe navigation in the Black Sea and halt attacks on energy infrastructure, with Washington playing a mediating role. The arrangement, akin to the Black Sea Grain Initiative, may ease insurance costs and export logistics for grain shipments, especially out of southern Ukraine. However, Russia is demanding partial sanction relief for the agreement to be fully enacted, while Ukraine has denied such preconditions.

The USDA’s latest crop progress update highlighted that Kansas winter wheat improved to 49% good-to-excellent, Texas to 31%, but Oklahoma dropped to 37% due to wind damage, wildfires, and drought. Nationally, 34% of U.S. winter wheat remains under drought conditions, up from 27% a week prior.

The European Commission’s MARS unit reported that EU crop conditions are better than last year, though Romania, Bulgaria, and Ukraine are seeing crop stress due to low rainfall. Forecasts for April suggest better moisture, which may support spring planting and recovery.

SovEcon revised its Russian wheat export estimate for 2024/25 down to 40.7 MMT from 42.2 MMT, citing poor margins and a stronger ruble. Barley and corn forecasts were raised, and 2025/26 wheat exports were adjusted to 39.1 MMT due to higher carryover stocks.

Brazil is experiencing corn-driven inflation. Corn prices in the Campinas region surged 23% YTD, driven by low stocks and strong feed demand, even as rice prices dropped. Analysts now expect food inflation to surpass the central bank’s 3% target, putting pressure on President Lula’s administration.

U.S. poultry slaughter dropped 4.9% year-over-year in February to 5.29 billion pounds. Reduced production may affect soybean meal and corn demand for feed, as per-capita productivity and live weights also fell.

In Ukraine, rapeseed production for 2025/26 remains unchanged at 3.2 million tons, with spring planting set to benefit from favorable weather forecasts. Soil moisture levels are still low but expected to improve in the next two weeks.

U.S. ethanol output is expected to decline slightly, with Bloomberg forecasting 1.084 million barrels per day for the week ending March 21. Stocks are projected to rise to 26.76 million barrels, signaling slightly bearish sentiment in the corn-for-fuel market.

Weather headlines highlight the return of widespread storms and rains across the U.S. later this week, particularly in the eastern Corn Belt. While winter wheat may benefit from moisture, spring crop planting could be delayed into early April.

In South America, April is expected to bring hot and dry conditions to Goiás and Central Brazil, raising risks for the second corn crop. Wet weather across Argentina continues, which may disrupt late-season harvests and transport.

Malaysian palm oil prices rose 14 ringgit overnight, while Chinese futures markets showed soybean gains. This signals firm Asian vegetable oil demand, which could influence U.S. and Brazilian soyoil trade flows.

China’s Sinograin is proceeding with its planned auction of 160,000 MT of imported soybeans to counter domestic tightness. However, analysts warn that the auction might clash with a surge in Brazilian Q2 arrivals, potentially limiting any upside for prices.