A US-Iran ceasefire reopens the Strait of Hormuz but cannot undo the fertilizer supply shock already baked into global crop cost structures.
Grain markets open Thursday with modest early gains across the wheat, corn, and soybean complexes, but the optimism is tempered. The Iran ceasefire removed the most acute crude oil premium — sending oil down $16.45 on Wednesday — yet analysts and traders are quickly pivoting from geopolitical relief to structural concerns, with WASDE, Export Sales, and a deepening fertilizer crisis all landing simultaneously.
Crude Oil and the Strait of Hormuz: Relief With a Caveat
Wednesday's single largest market mover was the announcement of a 2-week ceasefire between the US and Iran, which includes the reopening of the Strait of Hormuz. Crude fell $16.45 on the session — a sharp deflationary force that dragged wheat, corn, and soybean futures lower in sympathy. However, crude is already recovering $4.55 this morning as traffic through the Strait remains limited, signaling the market is not fully convinced supply disruptions are over. Energy-linked grain support is partial and conditional today.
Fertilizer Shock: The Problem That Does Not Go Away in 2026
Even as diplomatic tensions ease, Teucrium Trading's Jake Hanley warns that the ceasefire does not resolve the fertilizer crisis. Damage to natural gas plants in the Middle East and Strait gridlock have already created significant availability issues, with disruptions unlikely to be resolved before 2027 at the earliest. Corn is the most directly exposed crop given its nitrogen intensity. Farmers who cannot absorb sharply higher fertilizer costs face rationing decisions that could reduce yield potential for the 2026 US crop — a structural bullish underpinning that today's ceasefire optimism cannot erase. India underscored the severity by raising its nutrient-based subsidy 11.6% to $4.50 billion and issuing a tender for 2.5 MMT of urea, after global DAP prices surged approximately 20% since the conflict began.
WASDE Report: Modest Adjustments Expected Across the Board
Thursday's USDA WASDE report is the day's central scheduled event. For wheat, a Bloomberg analyst survey points to US ending stocks being trimmed 8 mbu to 923 mbu, with world stocks nudging up 0.4 MMT to 277.4 MMT. Corn is expected to see a marginal 3 mbu increase to 2.13 bbu for US carryout, with world stocks seen 0.4 MMT higher at 293.2 MMT. Soybeans show the least expected change, with US carryout seen falling just 1 mbu to 349 mbu versus March's 350 mbu, and world stocks edging up 0.2 MMT to 125.5 MMT. None of the anticipated changes are large enough on their own to be directionally decisive — market reaction will hinge on any surprise divergence from these tight pre-report ranges.
Export Sales: Demand Pulse Across All Three Crops
Export Sales for the week ending April 2 are also due Thursday morning. For wheat, traders are looking for 150,000–400,000 MT in commitments. A South Korean mill tender already provided a tangible demand signal Wednesday, with 90,000 MT of US wheat purchased in one tender and another 60,000 MT in a separate private tender — a combined 150,000 MT that offers baseline support. Corn export sales are expected in a range of 750,000 MT to 1.6 MMT for old crop, with South Korean importers adding to demand by purchasing 136,000 MT of corn in overnight tenders. Soybean old crop sales are seen at 200,000–600,000 MT, with meal expectations at 225,000–450,000 MT. A strong top-end outcome across any of these categories could provide the market a positive jolt heading into the afternoon.
Argentina: Record Corn Crop, Soybeans Hold Steady
Argentina's Rosario exchange raised its 2025/26 corn harvest forecast to a record 67 MMT — sharply above the previous estimate of 62 MMT and far exceeding the prior record of 52.5 MMT from 2023/24. The upgrade reflects an additional 420,000 hectares planted, bringing total corn area to 10.2 million hectares. This is a meaningful bearish headwind for corn, given Argentina's status as the world's third-largest exporter. The area expansion came partly at the expense of soybeans, which lost 200,000 hectares, though the exchange maintained its soybean harvest estimate at 48 MMT on improved yield expectations. For now, the corn bearish signal is more acute than the soy impact.
Biofuels: Indonesia's Mandate Acceleration and Brazil's B20 Push
Indonesia has formalized a timeline to move all biodiesel users to the B50 standard — a 50% palm oil blend — by 2028, accelerating earlier B40 targets. The mandate was partly driven by energy security concerns arising from the Iran conflict, and President Prabowo separately announced major investment plans in bio jet fuel refineries. Brazil is simultaneously exploring fast-tracking biodiesel blend tests up to B20 — above the current 15% mandate — as soy crushers seize on elevated diesel prices to push for higher mandated soy-based diesel blends. Together, these signals are constructive for vegetable oil demand globally, with indirect support for soymeal through crush margins and potential upside for soy oil, which is currently lagging.
US Weather: Planting Delays Brewing in Key Regions
US weather conditions are creating a mixed and complicated planting outlook. Frequent precipitation in the Northern Plains is beneficial for soil moisture but cold temperatures are generating snow and suppressing soil temperature gains — risking a compressed planting window for spring crops. The Central and Southern Plains remain drought-stressed in western areas despite some expected shower activity this week, offering only mixed improvement for winter wheat and pre-planting soil moisture. The Midwest faces the opposite concern, with surplus moisture and ponding risks potentially delaying corn and soybean planting in wetter pockets, while soil temperatures remain below the critical 50-degree threshold across most of the region. The Delta continues to battle drought despite isolated showers, complicating early planting and crop establishment.
Global Weather and El Niño Risk
Brazil's safrinha corn crop faces a disappointing end-of-season rainfall picture, with precipitation becoming isolated after brief frontal activity this week — a bearish quality signal for a crop already in development. China's North China Plain has seen minimal precipitation since last autumn, raising concerns about winter wheat despite satellite soil moisture readings, with upcoming systems forecast to miss the key wheat belt and favor southern canola areas instead. The longer-term risk is the rising probability of a significant El Niño event developing by the end of the June–August period, which analysts warn could elevate drought risk for US corn and soybeans this summer, as well as for southeast EU spring crops — a slow-building but increasingly credible upside risk factor for the second half of 2026.
Crop Futures Wrap
Wheat — May '26 CBOT SRW wheat closed Wednesday at $5.80 1/4, down 17 3/4 cents, and is currently trading up 7 1/2 cents at the start of Thursday. Wednesday's losses were driven by crude oil's sharp decline in the wake of the Iran ceasefire and long liquidation, with open interest falling 11,115 contracts. The partial morning recovery reflects bargain buying ahead of the WASDE and Export Sales reports, with South Korean tender demand providing demand-side support. KC HRW closed 7 to 12 1/4 cents lower, and MPLS spring wheat lost 11 3/4 to 17 cents on the day.
Corn — May '26 CBOT corn closed at $4.47 1/4, down 1 3/4 cents Wednesday, and is trading up 2 1/2 cents at the start of Thursday. Long liquidation was evident with open interest down 8,641 contracts, while the national average cash corn price slipped 1 1/2 cents to $4.08. EIA data showed ethanol production at 1.116 million barrels per day — above analyst expectations — with exports surging 80,000 bpd to 203,000 bpd, providing a supportive demand signal. The record Argentine corn harvest forecast and lingering fertilizer cost concerns are the dominant cross-currents for the crop today.
Soybeans — May '26 CBOT soybeans closed at $11.62, up 3 3/4 cents Wednesday, and are currently trading up 4 cents at the start of Thursday. Soybeans were the relative outperformer in Wednesday's session, supported by soymeal strength, with soymeal up $2.30 to $5.20 and soy oil down 150–230 points on the day. The Goldman roll contributed to May open interest falling 18,217 contracts while July rose 19,402 contracts. Brazil's biodiesel blend expansion push adds a medium-term demand tailwind for crush, though a near-flat WASDE outcome and modest new crop export sales expectations cap upside near term.