Key Policy Developments and Trade Trends

The final week of October 2025 was dominated by trade diplomacy, agricultural commitments, and shifting tariff landscapes that redefined sentiment across the global grain complex. The renewed U.S.–China engagement following the Trump–Xi summit in South Korea was by far the most market-moving event. The announcement that China would resume large-scale U.S. soybean purchases—following months of suspension—reinvigorated speculative and commercial buying interest.

By midweek, state-owned COFCO confirmed the purchase of three U.S. soybean cargoes for December–January shipment, marking Beijing’s first significant move since early summer. Later in the week, China added four additional cargoes (about 250,000 tons) for late-2025 and early-2026 delivery. These deals, equivalent to around 7 U.S. Panamax loads, were a symbolic reopening of trade corridors that had been largely closed for months due to tariff uncertainty.

The trade détente was formalized as President Donald Trump announced a tariff reduction on Chinese imports to 47%, down from 57%, in exchange for Beijing’s renewed agricultural commitments, continued rare-earth exports, and a pledge to curb the illicit fentanyl trade—a major geopolitical concern linking agricultural diplomacy with national security. Trump’s statement that “China will buy a tremendous amount of American soybeans” sent Chicago soybean futures to 16-month highs, reigniting confidence among U.S. exporters.

Still, the optimism was tempered by Washington’s decision to continue a Section 301 investigation into China’s trade compliance. The probe—revived under the Trade Act of 1974—keeps the White House legally empowered to reimpose tariffs should Beijing deviate from its commitments. This legal lever introduced volatility, reminding markets that the trade truce remained fragile.

In parallel, China’s Ministry of Commerce confirmed long-term plans to increase soybean imports from the U.S. to 25 million tons annually within three years, aiming to restore pre-trade-war levels. Yet, even with tariff cuts, private crushers in China face 13% remaining duties and low processing margins, making state-led purchases the primary driver of demand. This dual system—where state firms import for reserve and food security while private crushers maintain commercial caution—creates a segmented market dynamic that traders expect to persist through early 2026.

Beyond the bilateral U.S.–China axis, several secondary trade narratives shaped regional grain expectations:

• Canada and China moved to rebuild agricultural relations, as Canadian Prime Minister Mark Carney and Chinese President Xi Jinping prepared to meet at the APEC Summit. Canada seeks to lift China’s 76% tariff on canola, a vital oilseed crop used for both feed and biofuel, in exchange for easing Canadian duties on Chinese electric vehicles. If achieved, this deal could restore millions of tons of canola trade flows, indirectly influencing global oilseed and feed grain pricing dynamics.
• In Mexico, the government and the United States advanced talks on reopening cattle exports after a months-long suspension due to the screwworm parasite outbreak. While livestock-specific, this issue holds indirect implications for grain demand since feed markets depend on cross-border cattle movement. Mexico’s progress with sterile fly production programs was seen as a step toward stabilizing North American feed demand.
• Ukraine’s grain export slowdown remained another focal point. October exports of grains and legumes dropped 38% year-on-year, totaling only 2.28 million tons, with corn shipments down 65%. Logistics bottlenecks and an inconsistent shipping corridor through the Black Sea constrained trade flows, particularly toward the Middle East and EU markets. This tightening of Black Sea supply lent underlying support to European and U.S. wheat prices throughout the week.
• The European Union slightly increased its 2025/26 grain output forecast to 285.7 million tons, underscoring resilience despite frequent rains. The adjustment mainly came from soft wheat (+0.8 MMT) and barley (+0.2 MMT), with corn unchanged at 56.8 MMT. These stable numbers reassured markets that Europe remains a key stabilizing supplier heading into winter, offsetting weather disruptions elsewhere.
• In Russia, the Agriculture Ministry maintained its 2025 grain crop forecast at 135 MMT, even after harvesting 137 MMT in bunker weight, confirming abundant supply potential but limited export acceleration due to port and logistical constraints. Traders continued to monitor the Kremlin’s export pace amid seasonal restrictions and policy controls on wheat flows.
• Argentina’s political shift also captured attention after President Javier Milei’s coalition victory strengthened market reform momentum. Farmers expect new rounds of export tax cuts, particularly for corn and wheat, following Milei’s pro-liberalization agenda and his strengthened relationship with Washington. This policy trajectory could enhance Argentina’s competitiveness in global grain markets and increase export availability in the medium term.
• Indonesia and Malaysia added further complexity to the global oilseed balance. Indonesia confirmed an expanded biofuel program (B50) and projected palm oil output at 56 MMT in 2025, with potential increases to 57 MMT in 2026 under favorable weather. Malaysia, meanwhile, secured zero-tariff access to the U.S. for palm oil exports under a new bilateral trade deal, improving market reach and likely increasing competition for soybean oil. These developments link the grains and vegetable oils complex more tightly together, influencing global feed and energy substitution economics.

Futures and Price Dynamics

Throughout the week, futures activity reflected the oscillation between political optimism and supply-chain realism.
Wheat markets held steady gains, buoyed by global production updates and improved export competitiveness from the U.S. Plains after earlier rainfall. By Friday, soft-red wheat was up 10 ¾ ¢ on the week. European and Black Sea indicators moved modestly higher, supported by slower Ukrainian flows and weather-driven logistics limits.

Corn futures advanced 7 ¢ as U.S. harvest completion approached 75 % and ethanol data confirmed production stability despite rising inventories. Expectations for expanding Argentine corn acreage (7.8 M ha) and a slower Ukrainian export pace balanced the tone.

Soybeans were the clear outperformer. The combined effect of Chinese buying, Trump’s tariff reduction, and South American weather uncertainty lifted November 2025 futures almost 50 ¢ on the week. Soymeal surged $21.10 per short ton amid optimism about feed demand, while soyoil slipped 0.49 ¢ as vegetable-oil markets turned cautious. Chinese domestic futures echoed the move, with soymeal up 24 yuan while soybean futures dipped 9 yuan.

Regional Weather Highlights

Weather continued to shape both sentiment and physical fundamentals.
North America enjoyed a largely favorable outlook. Mild conditions across the Midwest and Great Plains facilitated late-harvest progress for corn and soybeans while replenishing moisture in drought-affected winter-wheat belts. The Delta region benefited from heavy rainfall early in the week that temporarily lifted Mississippi River water levels, easing barge movement constraints.

In South America, attention shifted to the diverging patterns between Brazil and Argentina. Brazil’s central belt saw the long-awaited return of showers after a week of dryness, critical for soybean germination and corn establishment. Yet southern Brazil faced localized flooding risks that may delay fieldwork. In Argentina, frequent rainfall maintained high soil moisture for corn planting but also brought cooler temperatures and disease pressure to winter wheat. Late-season frosts were reported in the southern Pampas, and while the full extent of damage remains uncertain, the Buenos Aires Grain Exchange kept its 2025-26 wheat output forecast at 22 MMT, the country’s second-largest on record.

Europe experienced continuous precipitation, improving soil moisture and supporting winter-wheat emergence but delaying harvesting and planting in parts of France and Germany. In the Black Sea region, additional rain boosted moisture reserves across Ukraine and southern Russia, vital ahead of dormancy. Forecast models suggest above-normal temperatures will delay winter slowdown, an encouraging sign for crop establishment.

Elsewhere, Australia’s eastern grain belt received beneficial though uneven rainfall, improving conditions for winter-wheat filling. In Southeast Asia, above-average precipitation aided Vietnamese coffee but posed risks of flooding, while dryness persisted in Malaysian palm regions, potentially trimming oil yield if extended.

Oilseed and Energy Interplay

Vegetable-oil markets provided a secondary undercurrent to grains. Indonesia’s palm-oil production outlook rose to 56 MMT for 2025 (+5 % y/y) on favorable weather and plantation investment. Malaysia’s exports climbed month-on-month, aided by a new U.S.–Malaysia trade accord granting zero-tariff access for palm oil. BMI and other analysts upgraded 2025 price forecasts citing robust Indian import demand, though they warned of a potential correction if soy-oil weakness persists. The shifting palm/soy ratio exerted downward pressure on soyoil futures even as soymeal’s strength pulled the crush margin higher.

Macroeconomic and Weather Outlook

The World Bank’s commodity outlook released late in the week projected a 7 % decline in average agricultural prices in both 2025 and 2026 but cautioned that an intensifying La Niña event could reverse that trend by constraining production in the Americas. Near-term forecasts keep U.S. weather benign through mid-November, but persistent wetness in Europe may limit fieldwork and seedbed preparation. In South America, forecasters highlight the risk of alternating wet and dry phases that could test planting timelines and disease management for early crops.

Outlook for Early November 2025

As November begins, market sentiment hinges on whether the U.S.–China détente translates into sustained soybean shipments and tariff normalization. Traders will watch for follow-through purchases and any escalation in the Section 301 probe. From a fundamentals perspective, South American weather—especially rainfall distribution in Brazil’s Mato Grosso and Argentina’s Pampas—will dominate short-term direction.

With global stockpiles comfortable but not abundant, futures are poised for continued volatility. Soybeans enter November with bullish momentum, corn shows cautious consolidation, and wheat remains balanced between improving U.S. moisture and ample European supply.

Overall, the week ending October 31 illustrated how geopolitics and climate interplay to dictate grain price dynamics, offering a reminder that in the global grains trade, diplomacy and weather remain the twin pillars of market motion.