Wheat

Chicago wheat futures for September 2025 opened Tuesday’s session at $5.06 ¾ per bushel, showing a slight uptick after Monday’s modest gains. Kansas City hard red winter wheat also moved firmer, while Minneapolis spring wheat weakened. U.S. harvest progress remains near completion, with winter wheat at 98% and spring wheat 53% harvested, just under the five-year average. Crop ratings slipped slightly, with only 49% rated good-to-excellent. Strong export demand continued, as USDA reported weekly shipments of 946,240 tons, more than double the previous week and 71% higher than last year, led by Indonesia, the Philippines, and South Korea. Despite robust trade flows, the market faces heavy pressure from Russian supply, as IKAR lifted its crop forecast to 86 million tons and exports to 43 million, underscoring Russia’s dominant position in global wheat trade.

Corn

Corn futures began Tuesday at $3.89 ¼ per bushel for the September 2025 contract, holding steady after Monday’s slight uptick. U.S. crop conditions remain strong, with 44% of fields dented and 7% mature, both in line with averages, and 71% rated good-to-excellent. Export inspections reached 1.305 million tons last week, up 24% from the prior week and nearly 39% higher year-on-year, with Mexico and Japan driving demand. U.S. cumulative shipments now stand at 65.5 million tons, 28% above last year. In Brazil, the second corn crop is 98% harvested, while planting of the 2025/26 first crop is 3.2% complete. Despite export optimism, disease risks remain, with southern rust and northern blight threatening yields across the Midwest.

Soybeans

Soybeans opened Tuesday at $10.25 ½ per bushel, rebounding by 6–7 cents in early trade after Monday’s decline. Monday’s close saw losses of 9–11 cents across contracts, pressured by weaker export shipments of 382,806 tons, down 24% week-on-week and nearly 9% below last year. Still, cumulative exports are 11.5% higher year-on-year at 49.3 million tons, with Indonesia, Mexico, and Italy among the top buyers. Crop ratings improved slightly to 69% good-to-excellent, while 89% of the crop is setting pods and 4% dropping leaves, both aligned with the five-year average. Market sentiment was also boosted by reports of a Chinese trade envoy heading to Washington, raising hopes of progress in U.S.–China agricultural negotiations, even as Brazil continues to dominate China’s soybean imports.

Global Market Drivers

A senior Chinese trade negotiator, Vice Commerce Minister Li Chenggang, is set to visit Washington later this week to meet U.S. officials, signaling progress in trade talks after President Trump extended a tariff truce earlier this month. While not part of formal negotiations, the visit adds optimism to grain markets that have been weighed down by escalating U.S.–China tensions.

In South America, Brazil’s grain sector faces key structural challenges despite record output projections. Consultancy AgResource projected 2025/26 soybean production at 176.5 million tons and corn at 138.4 million tons, but financial pressures remain acute, with farm credit tightening and defaults on agricultural loans rising sharply. At the same time, a Brazilian federal judge granted an injunction to suspend CADE’s order against the long-standing soy moratorium, protecting the pact that restricts soybean purchases linked to Amazon deforestation. The decision was welcomed by crushers and environmental groups but opposed by farm lobbies, keeping Brazil’s policy landscape volatile.

Argentina continues to struggle with weather setbacks, as heavy rains in the Pampas raised flood and disease risks for wheat crops, while frost damage added to uncertainty. Still, trade flows showed signs of normalization as Bunge chartered another soybean meal cargo for China, underscoring a slow return of Argentine supplies to global markets after recent disruptions.

Across Europe, the EU’s MARS unit cut corn yield forecasts due to summer heat and drought in Romania, Bulgaria, Greece, and southern Ukraine. Significant yield losses are expected in rain-fed agriculture, although conditions in Spain, northern France, Germany, and Poland remain favorable, keeping EU production balanced.

In the Black Sea, drought persists in eastern Ukraine and southwestern Russia. Analysts warn that depleted soil moisture threatens winter rapeseed sowing set to begin next week, while sunflower crops already face sharp yield downgrades. Although dryness has aided wheat and barley harvesting, the long-term supply outlook remains clouded.

Weather patterns globally remain a dominant force. North America’s Midwest will stay mostly dry and cooler this week, limiting late-season development. Canada faces frost risks, while Europe expects helpful rains ahead of wheat planting. In Asia, the remnants of Typhoon Kajiki will bring 100–200 mm of rain and possible flooding to northern Vietnam, Laos, and Thailand.

Trade and logistics also influenced sentiment. USDA reported barge shipments on the Mississippi River fell to 667,000 tons last week from 853,000, with soybean volumes down 36% week-on-week, while barge rates in St. Louis climbed to $18.51 per short ton. This highlights persistent strain in U.S. grain logistics despite strong export demand.

Protein markets added further complexity. U.S. poultry slaughter rose 1.6% year-on-year in July to 6.1 billion pounds, while Brazil’s poultry exports remain constrained by avian flu restrictions. These protein market dynamics continue to ripple back into grain demand, as feed requirements adjust to shifting livestock supply flows.