Corn and soybeans give back part of Tuesday’s sharp gains, while wheat remains supported by geopolitical uncertainty despite a neutral-to-bearish USDA balance sheet.
Agricultural markets are mostly lower on Wednesday morning after Tuesday’s rally triggered by smaller-than-expected US corn and soybean production. With USDA reports now behind the market and US harvest nearing completion, attention is shifting toward the US-Russia-Ukraine negotiations in the UAE and South American weather. No breakthrough has yet been reported on either a ceasefire or reopening the Black Sea for agricultural shipments.
USDA Raises the Price Floor for Corn
The biggest surprise in Tuesday’s USDA data came from corn. US yield was cut by 1.6 bpa to 179.6 bpa, compared with expectations for only a 0.6 bpa reduction. Production fell by 141 million bushels to 15.893 billion bushels, around 70 million below expectations, while harvested acreage was unchanged.
US ending stocks were reduced by 91 million bushels to 1.758 billion, 82 million below expectations. Demand was also lowered by 50 million bushels, split evenly between exports and feed use. The report appears to have strengthened the downside floor for corn, although a move beyond Tuesday’s highs may require either more threatening South American weather or unexpected Chinese demand.
Soybeans React to Tighter US Stocks
Soybeans also received a supportive USDA surprise. US production was raised by only 12 million bushels to 4.574 billion, well below market expectations, while yield increased 0.3 bpa to 53.3 bpa with harvested acreage unchanged.
More importantly, 2026/27 ending stocks were cut by 15 million bushels to 300 million, around 30 million below expectations. Exports were raised by 25 million bushels, and the average farm price increased by $0.10 to $12.10/bu. Global soybean stocks were lowered by almost 1 MMT to 123.5 MMT, while South American production and Chinese imports were left unchanged.
The tighter US balance sheet explains Tuesday’s strong rally, but South America now becomes more important. With US supplies reduced, trendline yields in Brazil and Argentina become increasingly important for maintaining comfortable global availability.
Wheat Data Was Neutral to Bearish
USDA’s wheat update was less supportive. US ending stocks rose by 3 million bushels to 743 million, in line with expectations, while global production increased by around 5 MMT to 827.5 MMT.
Argentina and Australia were each raised by 1.5 MMT, while global stocks climbed by roughly 5 MMT to 281 MMT, considerably more than expected. Russia and Ukraine export forecasts were each cut by another 1 MMT to 39 MMT and 11.5 MMT respectively, partly offset by higher Australian and Argentine exports.
Wheat therefore remains more dependent on geopolitical developments than on the USDA balance sheet itself.
Black Sea Negotiations Remain the Key Wheat Risk
Markets continue to monitor the UAE peace negotiations closely. So far there has been no reported breakthrough on a ceasefire or reopening the Black Sea for agricultural shipments.
Without progress, wheat could rebuild some war premium. Conversely, any credible step toward improved Black Sea trade flows would add pressure to prices, particularly after USDA raised global wheat production and stocks.
US Harvest Nears Completion as South American Weather Stays Benign
US weather remains broadly favourable for finishing the harvest. Light rain is expected around the Great Lakes and eastern Corn Belt, but otherwise the Midwest should remain dry through the end of the week.
South American weather is also non-threatening. Argentina is seeing a favourable mix of rain, sunshine and above-normal temperatures for planting and early crop development, while heavier rainfall in Brazil is shifting toward western-central and northern growing areas. That limits the immediate weather premium in corn and soybeans.
Demand Signals Remain Mixed
USDA reported a private sale of 312,700 MT of corn to Mexico and 150,000 MT of soybeans to Mexico on Tuesday. These sales provide some demand support, although there will be no USDA flash sales or EIA ethanol production data today because US government offices are closed for Veterans Day.
For wheat, EU exports from July 1 to November 8 reached 10.05 MMT, slightly above 9.89 MMT in the same period last year.
Energy Rebounds While the Dollar Strengthens
Energy markets have recovered, with spot WTI crude up $1.15 at $87.20 per barrel, RBOB up $0.01 per gallon and heating oil up $0.09.
The US dollar is moderately stronger and has reached a one-month high following Tuesday’s hotter-than-expected CPI report. PPI data are due Friday. A stronger dollar is a potential headwind for US agricultural export competitiveness, while the rebound in energy provides some support to the broader commodity complex.
Wheat Futures
Dec ’26 Chicago wheat is up 2 cents at around $5.95/bu, while Dec ’26 Kansas City wheat is also up around 2 cents, and Dec ’26 Minneapolis wheat is similarly firmer in overnight trade. Tuesday’s strength was largely driven by gains in corn and soybeans, while the USDA wheat balance sheet itself was neutral to bearish. Black Sea negotiations remain the main upside risk.
Corn Futures
Dec ’26 corn is down 2 1/2 cents at $4.46 1/2/bu, holding within Tuesday’s range after closing at $4.49. The sharp USDA cut to US production and ending stocks has raised the market floor, but further gains may require stronger demand or a more threatening South American weather outlook.
Soybean Futures
Jan ’27 soybeans are down 5 1/2 cents at $12.22 1/2/bu, holding within Tuesday’s range. Next resistance is the 100-day moving average at $12.51 3/4. Dec ’26 soybean meal is down $1.60 at $324.90, while Dec ’26 soybean oil is up 67 points at 63.44, marking new weekly highs. The tighter US stocks outlook is supportive, but the market now needs South American weather to remain favourable to avoid further tightening.