Market News

Wheat posts gains on drought concerns, risk premium

Soybeans were lower on profit taking and technical selling. U.S. planting weather generally looks favorable, Brazil’s harvest is close to wrapping up with CONAB’s next round of numbers out on the 14^th, and Argentina’s harvest is moving forward. The USDA says 6% of U.S. soybeans have been planted, compared to the five-year average of 2%. There are some concerns the military action in the Middle East will further delay a major trade meeting with China. That face-to-face meeting between President Trump and President Xi was originally expected to happen in late March and now might not occur until mid-May. The market had been banking on a big increase in old crop demand from China to boost export numbers, but that window is closing and South American supplies are flooding the market. Export inspections were up on the week and the year, but the 2025/26 pace continues to trail 2024/25 by a wide margin. The top destinations were China and Egypt. Soybean meal was mixed, adjusting spreads, and bean oil closed lower, drifting as crude oil dipped from the session highs.

Corn closed mixed, mostly weak, unable to hold onto the initial gains after crude oil slipped below $100 per barrel. Recent rainfall is beneficial long-term for U.S. corn, Argentina is seeing strong yields, and parts of Brazil’s second crop got rain over the weekend. Stateside, as of Sunday, 5% of U.S. corn is planted, compared to 4% on average. Corn has solid demand but also has a large available domestic supply with the next round of USDA supply and demand numbers out May 10^th. Export inspections were below the previous week and a year ago but were more than what’s needed to meet USDA projections for the current marketing year, mainly to Mexico and Japan. APK-Inform lowered their guess for Ukraine’s 2026 corn crop to 31.5 million tons.

The wheat complex was higher on fund and technical buying. Weather for much of the hard red winter wheat growing region this week looks warm and dry. For winter wheat, 34% of the crop is rated good to excellent, down 1% on the week, and continuing to show soft red winter in better shape than hard red winter, with 11% of the crop headed, compared to 7% most years in mid-April. For spring wheat, 6% of the crop is planted, compared to the typical pace of 7%. The trade also added back some risk premium connected to the Middle East as it might take some time for full movement of fuel and fertilizer outside of the region to be restored. U.S. wheat export inspections were down from the prior week and last year but still topped what’s needed to meet the USDA’s mark for 2025/26, with Mexico and Taiwan topping the list. APK-Inform now has Ukraine’s wheat crop at 19.9 million tons, a little bit less than the last guess, while cutting 2025/26 exports 1.5 million tons to 13 million. Russia raised its 2025/26 grain export quota 5 million tons to 25 million.