Grain markets opened Wednesday with modest and varied movements, reflecting ongoing weather volatility, international trade dynamics, and updated supply-demand expectations. The July 2025 Chicago contracts for major grains opened the session as follows: wheat at $5.37¼ per bushel (down 1½ cents), corn at $4.20 per bushel (down 3½ cents), and soybeans at $10.24¾ per bushel (up 9½ cents).

Wheat

After Tuesday's solid gains, wheat started Wednesday slightly weaker. The market had closed the previous day with Chicago SRW contracts up 8 to 11 cents, while Kansas City HRW and Minneapolis HRS also posted moderate increases. The U.S. winter wheat harvest, now 37% complete, is trailing the five-year average pace. Conditions dipped to 48% rated good/excellent, with noticeable declines in Nebraska and Texas, but improvement in Colorado and Kansas. Spring wheat is 38% headed, 1% below average, and its condition index nudged down to 53% good/excellent. Ukraine’s wheat exports for 2024/25 are reported at 15.7 million metric tons, down significantly from 18.5 MMT last year.

Corn

Corn futures edged lower at the Wednesday open, following slight losses the day before. U.S. corn demand for ethanol remains robust with May usage reaching 449.44 million bushels, up 6.2% from April but still slightly below May 2024 levels. Despite this, USDA data show year-to-date ethanol use just above last year’s pace. Weather forecasts indicate 1.5 inches of rain across parts of Nebraska, Iowa, Minnesota, Wisconsin, and the Dakotas over the next week. Ukrainian corn exports for 2024/25 are projected at 22 MMT, trailing last season’s 29.5 MMT. Brazil’s production outlook was revised up to 136.1 MMT by StoneX, driven by improved second crop expectations, although ANEC lowered Brazil’s corn export estimate for June to 566,435 MT.

Soybeans

Soybeans showed strength at Wednesday’s start, extending the recovery seen on Tuesday. July contracts added ½ cent during the previous session, and national cash prices firmed to $9.88¾. The USDA’s Fats & Oils report for May noted 203.7 million bushels crushed—a 6.3% increase year-over-year. Soy oil stocks decreased significantly, indicating healthy demand. Brazil's June exports were pegged at 13.93 MMT, slightly higher than earlier estimates. StoneX also raised Brazil’s crop forecast to 168.75 MMT. The overall market was buoyed by increased open interest and active deliveries, suggesting firm investor engagement.

Global Drivers Shaping Today’s Grain Market Landscape

China’s Fufeng Group, previously blocked from building a corn mill in North Dakota, is close to finalizing a new U.S. location, with Douglas County, Illinois as a likely candidate. The project remains under scrutiny due to U.S.-China tensions, affecting broader sentiment on Chinese investments in U.S. agriculture.

Weather dominates the outlook across major grain-producing regions. In North America, scattered rains bring short-term relief, but forecasts suggest hotter and drier conditions into mid-July. The Canadian Prairies are especially at risk with limited precipitation projected for southern wheat and canola areas.

In Argentina, excessive rainfall is forecasted for the Pampas over the next 10 days, while Brazil’s winter corn harvest continues under favorable conditions, though some specialty crops were hurt by last week’s frost.

The European grain belt is poised for increased rainfall this weekend, particularly in the north. While this benefits corn and sunflower growth, drier weather would be preferred for maturing winter wheat.

India reported a dramatic 61% month-on-month jump in palm oil imports in June, reaching an 11-month high. This reflects lower inventories and a price advantage over soy and sunflower oils, boosting edible oil trade and supporting prices in Malaysia and Indonesia.

Malaysia’s June palm oil exports rose 4.3% month-on-month to 1.29 million tons, driven by EU demand. Meanwhile, BMI forecasts palm oil to trade between 3,800–4,000 ringgit/ton through year-end, citing U.S. biofuel policies and global production increases.

Brazil is expected to hold 20.5 million tons of corn in ending stocks by season's end, up from 16.3 million last year. The surge stems from record yields and slow market absorption, which could put downward pressure on prices.

Argentina set new export records in June—shipping 23.53 million tons of grains and derivatives, or 36% of its half-year total—just before higher grain export taxes took effect on July 1. Taxes rose to 33% for soybeans and 12% for corn. This pre-tax export rush may cause a slowdown in trading volumes during July.

Market sentiment in Argentina is expected to cool. Farmers doubled their June sales ahead of the tax increase, and analysts predict calmer activity in July, potentially tightening global supply temporarily if farmer sales pause.

U.S. soybean crush and corn ethanol use data continue to influence domestic demand trends. Weekly ethanol production is projected slightly lower at 1.08 million b/d, with stockpiles estimated near 24.3 million barrels.

Sentiment in U.S. agriculture slipped notably in June. Purdue University’s ag sentiment index dropped to 146 points from 158 in May, with future expectations falling sharply—highlighting increasing concerns among producers.

The Antarctic Oscillation is entering an extreme positive phase, likely to influence Southern Hemisphere weather in coming weeks. This could affect South American and Australian crop patterns during critical growth stages.