U.S. Crop Futures – Closing Prices (July 25 Contracts)

Wheat

Wheat futures closed the Wednesday session with notable strength. July CBOT wheat settled at $5.24¾, climbing 7½ cents on the day. Kansas City hard red winter wheat outperformed with gains of 10 to 12 cents, while Minneapolis spring wheat lagged, slipping by 3 to 4 cents. Support came from improved U.S. crop assessments—Day 1 of the Kansas wheat tour showed yields of 50.5 bpa, a 4-year high—and news that Algeria booked 660,000 MT in a wheat tender. However, spotty rainfall in key areas like Kansas and Texas continues to limit crop confidence.

Corn

Corn posted modest gains on Wednesday. July corn futures rose 3 cents, closing at $4.45½. Support came from expected widespread rains across the Northern Plains and Eastern Corn Belt, which could slow planting progress but help crops already in the ground. USDA ethanol data added mixed sentiment: weekly output dipped below 1 million bpd for the first time since September, while stockpiles grew slightly. Export bookings for old crop corn are expected between 0.9 and 1.5 MMT.

Soybeans

Soybeans edged higher on the day. July contracts closed at $10.77¾, up 5¼ cents. Market optimism held despite underlying trade tensions with China. Soymeal slipped $1.30/ton, while soyoil posted gains of 52 to 72 points. Export expectations for the week of May 8 remain tepid, with up to 500,000 MT in old crop sales. Meanwhile, Argentina's crop outlook improved as the Rosario Exchange raised its production estimate by 3 MMT to 48.5 MMT. NOPA data, due Thursday, is anticipated to show a slowdown in April crush but a year-over-year increase.

Key Global and Structural Developments Influencing the Grain Market

Brazil’s strengthening alliance with China dominated political headlines, as President Lula signed over 30 agreements during a state visit to Beijing. These included partnerships in mining, infrastructure, AI, and climate collaboration. Despite warnings from the Trump administration, Lula emphasized Brazil’s autonomy and vision of deeper economic integration with China, reinforcing the importance of South America in global grain flows.

Soybean trade remains clouded by uncertainty. A temporary truce between the U.S. and China has reduced tariffs but not eliminated them. U.S. soybeans still face a 10% duty, compared to zero for Brazilian beans. As a result, Brazil maintains a competitive advantage, supplying over 70% of China's soybean imports. American farmers, already reeling from the effects of past trade wars, worry this temporary relief may not be enough, particularly with Brazil poised to deliver another record crop.

Adding to bearish sentiment, China’s first 2025/26 outlook predicts a 2.8% decline in soybean imports, as it aims to reduce soymeal use in animal feed. This structural change suggests slower long-term demand growth, a critical factor for both U.S. and Brazilian producers.

Vegetable oil dynamics in Asia continue to sway soyoil prices. India’s April imports dropped to a 4-year low, pulling domestic stockpiles to their lowest level in nearly five years. Although soyoil imports ticked up slightly, palm oil purchases fell sharply. With palm oil now trading at a discount, Indian buyers are expected to shift back, potentially boosting demand for Malaysian and Indonesian supplies.

Indonesia, the world’s largest palm oil exporter, will raise its crude palm oil export levy from 7.5% to 10% starting May 17 to fund biodiesel programs and replanting efforts. The price burden is expected to be passed on to global buyers, providing further bullish pressure on oilseed product prices.

Weather risks also loom large across growing regions. North America braces for heavy rainfall in the northern Midwest and cooler-than-normal conditions in Canada, which could delay planting. Meanwhile, Europe faces diverging trends: wet weather in France and Spain is seen as beneficial, but Germany trends dry. The Black Sea region continues a slow recovery from drought, but patchy frost and cold air raise concerns about spring development.

In South America, Brazil now depends on weather fronts from Argentina to sustain soil moisture, critical for the second corn crop and winter wheat seeding. In Argentina, stable conditions aid both harvesting and early wheat planting, although showers expected later this week could improve soil moisture for later sowings.

Geopolitical shifts in commodity flows continue. China opened its market to Brazil’s corn ethanol coproduct (DDG) during Lula’s visit, creating new trade channels. Brazil also plans to expand its planted area by nearly 14% next marketing year, following acquisitions of land and assets.

Ukraine’s grain exports remain significantly constrained. As of mid-May, total exports reached 36.7 million tons, down 17% year-over-year. Corn exports fell over 21%, and wheat dropped more than 13%. The spring planting campaign continues despite weather challenges, but lower planted acreage for soybeans and winter wheat hints at tight future supplies.

Russia increased its agricultural exports to the UAE by 26% in Q1, with wheat making up 82% of total shipments. The rise in grain, dairy, and poultry exports signals Russia’s expanding reach in Middle Eastern markets, intensifying competition for traditional exporters like the U.S.

Altogether, the grain market remains in flux. Trade deals, weather anomalies, and production estimates are actively reshaping expectations, with China, Brazil, and the Black Sea region playing pivotal roles. Markets are watching for updates in export data and crop progress reports, while geopolitical signals remain top of mind for traders.