Wheat

July 2025 Chicago SRW wheat closed at $5.37 per bushel, down 7 1/4 cents. The market was pressured by underwhelming U.S. export inspections and a drop in crop condition ratings, despite early harvest activity. Concerns linger over mixed global crop prospects, especially between dry regions in Ukraine and the more promising harvests in Romania and Bulgaria.

Corn

July 2025 contracts closed at $4.35 per bushel, down 9 3/4 cents. Losses were driven by bearish USDA inspection figures and mixed U.S. field conditions. Although crop conditions improved slightly, competition from a strong Brazilian second crop and logistical challenges in Ukraine continue to weigh on sentiment.

Soybeans

July 2025 soybeans settled unchanged at $10.70 per bushel. Gains in soyoil and record May crushing data supported the market, despite weaker export inspections and declining crop ratings. Biofuel policy shifts and China’s strategic stockpiling also shaped the broader oilseed landscape.

Global Market Movements and Influential Developments – June 16, 2025

The global grain market began the week under intense pressure from a series of geopolitical and macroeconomic developments that are shaping market behavior and trader sentiment. Foremost among these was the escalation of military conflict in the Middle East, as Israel launched extensive airstrikes on Iranian nuclear facilities on Friday. The attacks targeted strategic infrastructure and killed several senior Iranian military leaders, including the heads of the Islamic Revolutionary Guard Corps and the national military staff. Explosions rocked major cities including Tehran and Natanz, prompting Iran to vow retaliatory strikes against both Israel and potentially U.S. assets in the region. Although no radiation breaches were confirmed, the scale of Israel’s campaign—said to involve 200 aircraft—sparked fears of broader conflict and sent global oil markets surging.

The immediate consequence of this escalation has been heightened volatility in energy markets. Crude oil prices rose significantly in response to fears of disrupted shipping routes in the Persian Gulf and Red Sea, two critical maritime corridors for both fuel and grain logistics. Higher fuel prices may soon translate into elevated costs for fertilizers, transportation, and agricultural input supplies globally, affecting profit margins and potentially altering planting decisions in key producing countries. Investors also moved funds into safe-haven assets, tightening liquidity across commodity futures, including grains.

Meanwhile, futures and export data from the U.S. Department of Agriculture (USDA) confirmed the cautious tone. USDA export inspections for the week showed wheat at just 286,546 metric tons, down from 338,330 the previous week and below market expectations. Corn inspections fell to 1.078 million metric tons, and soybean inspections also dipped to 276,197 metric tons. These figures reinforced a narrative of slow U.S. export momentum and eroding competitiveness, especially in the face of aggressive pricing and logistical advantages from Black Sea suppliers and South American exporters.

Crop condition ratings added another layer of concern. U.S. winter wheat conditions dropped to 47% good-to-excellent, down two percentage points from the previous week. Corn conditions saw a minor improvement to 72%, while soybean ratings fell three percentage points to 70%. These shifts highlight ongoing weather-related stress across the U.S. grain belt, including persistent dryness in Kansas and the Southern Plains and excessive rainfall in portions of the Midwest. Weather remains a wildcard, with updated forecasts pointing to continued instability that could delay harvests and planting progress.

On the macroeconomic front, market participants remain watchful of potential policy shifts in the United States. President Donald Trump reiterated plans to introduce new tariff measures, with formal communications to trade partners expected by the end of June. The agricultural community is particularly sensitive to these developments, recalling previous waves of retaliatory tariffs that crippled U.S. export volumes to major markets like China, Mexico, and the European Union. The July 9 implementation deadline looms large for forward contracting strategies.

Biofuel policy also continues to influence oilseed dynamics. The U.S. Environmental Protection Agency is widely expected to reduce biomass-based diesel blending mandates for 2026–27, a move that would lower domestic demand for soy oil. In response, futures for soyoil have shown relative resilience, supported by strong Asian buying, particularly from India and China. Yet crushing margins in the U.S. remain under strain due to slow farmer selling and reduced plant utilization.

In Europe, tariff-free ethanol imports from the U.S. have shaken the domestic biofuel sector. Major plants like Vivergo and Ensus have scaled back wheat purchases and warned of possible shutdowns due to deteriorating margins. If realized, this shift could reduce wheat demand across the UK and parts of continental Europe, intensifying oversupply concerns and weakening regional prices. The ethanol sector's distress underlines the unintended consequences of trade liberalization on commodity utilization.

The Black Sea region continues to evolve as a strategic grain corridor. Romania, Bulgaria, and Ukraine are poised for strong harvests, with Romania’s corn output projected at 11.4 million tons and Bulgaria potentially doubling production to 3.3 million tons. Ukraine has completed spring sowing, but grain exports remain subdued, down 19% year-over-year. The end of EU duty-free access is pushing Ukrainian traders toward Middle Eastern destinations, particularly Jordan and Turkey. Weather remains uneven, with Russia benefiting from recent rainfall while southern Ukraine and Turkey struggle under dry conditions.

India’s import activity is also reshaping vegetable oil markets. In May, palm oil imports surged 84% month-over-month, with notable increases in soyoil and sunflower oil as well. The Indian government’s decision to halve import duties on crude edible oils has incentivized imports of raw oils over refined products, strengthening domestic refining margins and supporting food price stabilization efforts.

In China, soybean imports reached a record 13.92 million tons in May, mostly sourced from Brazil. The surge reflects ongoing stockpiling efforts amid stalled trade negotiations with the U.S. Despite some signs of engagement, elevated tariffs on American agricultural products remain in place. Chinese crushers booked at least 40 Brazilian soybean cargoes in early April, ensuring a steady flow of feedstock to domestic processors even as pork profitability remains subdued.

Lastly, futures trading sentiment remains highly fragile. Wheat, corn, and soybeans all posted losses on Friday, and while soybeans held steady on Monday, both wheat and corn extended their declines. Soymeal and corn continue to underperform, while soyoil remains a bright spot due to strong international demand. Market participants remain attuned to every piece of macroeconomic, weather, or trade data, navigating a period defined by overlapping risks and structural shifts.