Wheat futures posted fresh losses on Wednesday, continuing the week’s bearish momentum. May 2025 Chicago SRW Wheat closed at $5.35¼ per bushel, down 8 cents on the day. Kansas City HRW contracts lost 4 to 6 cents, and Minneapolis spring wheat also declined by 3 to 4 cents. Weaker Black Sea tensions and improving U.S. crop conditions contributed to the downturn, while traders prepared for Thursday’s USDA export sales report, with expectations ranging from 0 to 550,000 MT for old crop wheat and up to 300,000 MT for new crop. The weather forecast calls for rains across SRW areas this weekend into next week, but HRW regions are expected to remain relatively dry. Additionally, traders are watching for Monday’s quarterly grain stocks report, with Bloomberg’s survey projecting 1.221 billion bushels (bbu) of wheat on hand as of March 1.

Corn futures also closed lower on Wednesday, pressured by ethanol-related data and broader commodity weakness. May 2025 Corn settled at $4.51¼ per bushel, a 6½ cent loss. Cash corn prices fell by 6 cents to $4.17. The U.S. Energy Information Administration (EIA) reported a 52,000 barrels-per-day decline in ethanol production for the week ending March 21, down to 1.053 million bpd, while ethanol stocks rose to 27.35 million barrels. Export demand showed strength, with old crop sales expected between 0.6 and 1.6 MMT and additional tenders from Taiwan (65,000 MT) and South Korea (280,000 MT). Early U.S. planting continued to progress, particularly in the southern states. Market participants now turn attention to Monday’s grain stocks data, with expectations averaging 8.153 bbu for corn.

Soybeans finished Wednesday's session narrowly lower in nearby contracts, while deferred months saw marginal gains. May 2025 Soybeans ended the day at $10.01 per bushel, down ¾ cent, with the national cash price ticking slightly down to $9.42½. Soymeal futures dropped by 90 cents to $1.50/ton, while soyoil climbed 33 to 41 points. Traders are awaiting Thursday’s export sales data, expecting soybean sales between 300,000 and 900,000 MT for old crop and up to 50,000 MT for new crop. March 1 soybean stocks are forecasted at 1.905 bbu. Brazil's soybean exports for March are seen steady at 15.56 MMT, with meal exports revised lower to 2.3 MMT.

Key Global Drivers and Market Headlines

The global market was impacted by news that Russia and Ukraine agreed to resume safe navigation in the Black Sea and halt attacks on energy infrastructure. These U.S.-mediated ceasefire agreements, although fragile, aim to reduce shipping and insurance costs for Ukrainian exports and bring more predictability to global grain logistics.

The European Commission’s MARS report noted that EU crop conditions are overall better than last year. However, Romania, Bulgaria, and eastern Ukraine continue to experience rainfall shortages, though April forecasts predict better moisture.

SovEcon further revised down its Russian wheat export forecast for 2024/25 to 40.7 MMT due to sluggish shipments and poor profit margins caused by a stronger ruble. Despite these adjustments, 2025/26 projections were slightly raised to 39.1 MMT on expectations of high carryover stocks.

In Brazil, inflation is becoming a concern as corn prices in the Campinas region have risen over 23% year-to-date, crossing 90 reais per 60-kg bag — the highest nominal level in nearly three years. Corn-driven inflation is expected to push food prices up by over 1 percentage point in six months, adding pressure on Lula’s administration.

The USDA reported a 4.9% year-on-year drop in U.S. poultry slaughter in February, signaling potential shifts in feed demand, especially for corn and soybean meal. Live chicken weights also declined by 3.6%.

Ukraine’s rapeseed outlook for 2025/26 remains steady at 3.2 million tons, though drought concerns linger. Favorable weather over the next two weeks is expected to help spring plantings.

The ethanol market showed a pullback in weekly U.S. production and rising inventories, suggesting potential softness in corn demand for fuel. Production dropped to 1.053 million bpd, while stocks rose to 27.35 million barrels.

U.S. weather forecasts predict widespread storms and cooler conditions in the coming days. Rain will be beneficial for winter wheat but may delay early spring planting in the Corn Belt.

April weather in South America remains a concern. Central Brazil is expected to face hot and dry conditions, which could harm the second corn crop. Meanwhile, persistent wetness in Argentina may impact harvest progress and transport infrastructure.

Malaysian palm oil prices climbed 14 ringgit overnight, while Chinese soybean futures gained 5 yuan. This trend points to ongoing firmness in Asian vegetable oil markets, which could influence U.S. and Brazilian soyoil trade.

Finally, China’s Sinograin is pressing ahead with its auction of 160,000 MT of imported soybeans to address domestic shortages caused by delays in Brazilian shipments. However, analysts caution that the auction may coincide with a surge of Q2 arrivals, potentially capping prices.