Wheat

Wheat futures opened Wednesday on firmer footing, continuing their bounce from earlier in the week. The July 25 Chicago SRW contract opened at $5.38¼, building on Tuesday’s close of $5.36. Momentum in wheat has been supported by ongoing weather impacts and planting reports. While conditions in U.S. winter wheat fields are relatively stable, heavy rains in the Southern Plains are receding, allowing fields to drain. A crop tour in Oklahoma estimated the state's harvest at 101.169 million bushels, down from last year due to planting reductions and April flooding. Ukraine's wheat forecast dipped slightly to 19.8 million tons amid dry, cool weather and poor soil moisture in key producing oblasts. Meanwhile, China’s Henan province is facing hot, dry winds with low soil moisture ahead of harvest, raising further concerns about global supply.

Corn

Corn futures saw renewed strength Wednesday morning, with July 25 contracts opening at $4.60½, following a Tuesday close of $4.55½. The week began with modest gains and a 748-contract increase in open interest, reflecting cautious optimism. Census data showed March U.S. corn exports at 7.34 million metric tons—up 22% from February and 24.5% year-on-year. The ethanol sector continues to support demand, with exports reaching a 7-year high of nearly 196 million gallons. On the production side, planting delays were noted in Illinois, Kentucky, and North Carolina, but a record U.S. crop is still projected at 15.78 billion bushels. Ukraine's output holds steady at 27.9 million tons, while Brazil is expected to produce 125 million tons, benefiting from improved late-season weather. South Korean buyers remained active, securing an additional 66,000 metric tons overnight.

Soybeans

Soybeans opened strongly on Wednesday, with July 25 contracts at $10.53¾, rebounding from Tuesday’s close of $10.41¼. The bounce comes despite slight losses earlier in the week, as trade activity and weather concerns influence direction. Planting is progressing ahead of schedule, with 30% complete versus a 23% average pace, though Illinois lags slightly. March export data was particularly encouraging: U.S. soybean exports hit 3.498 million metric tons—the fourth-highest March figure since 1967—and soymeal exports reached a record 1.593 million tons. Meanwhile, Brazil’s 2025/26 soybean area is projected to grow by another 500,000 hectares, suggesting long-term bearish supply pressure. In Argentina, harvesting stalled again due to heavy rains, raising concerns over crop quality.

Key Global Market Influencers

Global wheat markets remain vulnerable to changing weather patterns, particularly in the U.S., Ukraine, and China. Oklahoma’s 2025 wheat yield projection declined to 35.9 bushels per acre, with excessive rainfall causing both damage and recovery across fields. Ukraine’s wheat outlook was revised slightly downward to 19.8 million tons due to persistent dryness and six-year low soil moisture in major growing regions. China’s Henan province—the nation’s top wheat producer—is grappling with 35°C temperatures and hot, dry winds, threatening output during critical development stages.

Ukraine’s corn outlook remains steady at 27.9 million tons. Although planting is progressing at a much faster pace than last year (48%), ongoing cool temperatures and dry soil conditions may delay completion. Weather forecasts call for continued precipitation, which could improve soil moisture but slow planting momentum.

Tight global corn supplies persist, but expectations for record U.S. production in 2025/26 may bring relief. Analysts forecast a 15.78 billion bushel harvest, with ending stocks projected at 2.04 billion bushels. Global corn ending stocks are anticipated to rise to 297.6 million tons. Brazilian production is also set to increase to 125 million tons, while Argentina is expected to deliver 49 million tons following favorable weather improvements.

Soybean production and export prospects remain strong. U.S. March soybean exports were up 12.2% month-over-month and 14.5% year-on-year, with marketing year shipments surpassing 42 million tons. Soymeal and soy oil exports were particularly robust, hitting multi-year highs. Meanwhile, Brazil's massive 2024/25 crop of 172.1 million tons cements its global leadership, and further expansion is expected next season. However, in Argentina, the harvest continues to face interruptions due to rainfall and excess humidity, with only 25% of the crop collected.

In vegetable oils, Malaysian palm oil prices fell to 3,727 ringgit overnight, pressured by higher inventories and weaker exports. Analyst Dorab Mistry expects further price declines toward 3,500 ringgit by November. With palm oil now trading at a discount to soybean oil, consumption dynamics are shifting globally. Indian palm imports may decline significantly, with total edible oil imports forecast at 15.7 million tons—down nearly 1 million tons from earlier estimates.

Ethanol production is facing new headwinds. Bloomberg’s survey ahead of the EIA report suggests a weekly drop to 1.036 million barrels per day. While demand remains stable, uncertainty around U.S. biofuel policy clouds the long-term outlook. Industry experts warn that the longstanding Biodiesel Blenders’ Tax Credit (BTC) is unlikely to return, and confusion persists over the new 45Z credit tied to carbon intensity.

Trade relations remain a critical factor. U.S. Treasury Secretary Bessent and Chinese Vice Premier He Lifeng are scheduled to meet in Geneva this Saturday, rekindling hopes for cooperation amid ongoing agricultural tensions. Meanwhile, U.S. Agriculture Secretary Rollins will tour Japan, India, and Vietnam to discuss tariffs and seek expanded markets. This reflects broader efforts by the Trump administration to support U.S. agriculture through diplomatic channels.

Russia has raised its wheat production forecast to 83.8 million tons, with exports now projected at 41.3 million tons—adding further competitive pressure on the Black Sea market. The EU, by contrast, is facing lagging exports, down 9.17 million tons year-on-year.

Japan’s Zen-Noh cooperative has opened a new grain trading desk in Geneva, signaling a strategic shift toward global trading. The cooperative already holds strategic assets in Brazil and Canada and is expected to increase its role in international markets, especially as demand for reliable, diversified grain sourcing grows.

Finally, the U.S. agricultural sentiment index rose to 148 in April, its highest since the start of the year. While farmers remain cautious about tariff impacts in the short term, most are optimistic that current policies will ultimately benefit American agriculture. This sentiment boost may support further investment in planting and technology ahead of the new season.