Mid-week markets closed sharply higher on Wednesday, as fresh rumors of Chinese ag buying spurred short covering in the grains and speculative buying throughout the soy complex, leading to gains in all three major crop markets. We have little insight into what Trump might say tomorrow, but the rally is nonetheless a bright spot for farmers in what has otherwise been a rather poor several weeks of price action.

🌽 Corn Market Update

📈 Prices:

• September Corn (CU): $4.18, up 12 cents
• December Corn (CZ): $4.33 1/2, up 11 1/2 cents
• September/December Spread (CU/CZ): -15 1/2, up 1/2 cent

📋 Market Headlines:

• Data from the EIA in this morning's weekly ethanol report showed average daily production in the week ending June 27th at 1.076 mil bbls/day, which was down just 0.5% from last week but up 3.2% from the same week last year. Stocks in the week were seen at 24.117 mil bbls, which was similarly down 1.2% from last week but up 3% from last year.

• We estimated corn usage in the week at 106.3 mil bu, which brings cumulative marketing year usage to 4.550 bil bu; this compares to 4.421 bil bu through the same week last year, and the USDA's full marketing year forecast of 5.500 bil bu. To reach the USDA's target, corn grind needs to average 105.6 mil bu for the rest of the marketing year.

• The Ukrainian Ag Ministry, following the recent completion of their marketing year, said they project final corn exports in the season at 22 MMTs, which if accurate, would be down significantly from the 29.5 MMTs exported in the 2023/24 season. The Minister said the reductions were likely due to reduced production and logistical challenges.

Summary:

Corn futures had one of their better days in weeks on Wednesday, as spill-over buying from the soybean market led to fund short covering throughout the morning and into the close. Until Trump announces that China will be making increased purchases of US corn, we see the move mostly as a selling opportunity though, with nothing really having changed fundamentally to this point and a massive US crop still looming in another couple months. That said, we don't see a lot of reason for Sep futures to fall below $4, but at the same time, can't justify a lot of upside price action either.

🌱 Soybean Market Update

📈 Prices:

• August Soybeans (SQ): $10.53 1/2, up 23 3/4 cents
• November Soybeans (SX): $10.48, up 20 3/4 cents
• August Soybean Meal (MQ): $276.80, up $3.10/ton; outside day higher, new contract low at 271.0
• August Soybean Oil (LQ): 55.02, up 1.36 cents/lb
• August/November Spread (SQ/SX): 5 1/2, up 3 cents

📋 Market Headlines:

• Soybeans rallied Wednesday on unconfirmed rumors that President Trump would be announcing a recommitment to the Phase One trade agreement by China at a rally in Iowa tomorrow evening.

• While we can neither confirm nor deny such an announcement, we would offer caution against chasing a market on rumors ahead of a three-day holiday weekend; should Trump not make any comment regarding China tomorrow evening, Sunday night's trade could very well remove the premium that has been inserted today.

• Soybean oil prices again saw gains of more than 2% on Wednesday, as buyers continue to see value at current price levels based on what should be increased domestic demand in the short and medium term due to positive developments on 45Z in recent days.

Summary:

It was a good ol fashioned China day in the soybean market on Wednesday, as fresh rumors of a potential return to the Phase One purchase agreement, or at least something similar, led to a flurry of mid-morning buying that lasted into the close. We said it numerous times this past winter and spring that we didn't see any such agreement as likely due to China's significant shift in purchasing habits over the past several years and their shift to become less reliant on the US, and we would see these arguments as still true today despite the recent rumors. China does not need US beans like they did 10-20 years ago, which makes today's pop interesting. Be prepared for increased volatility tomorrow and Sunday evening, with the market closed Friday.

🌾 Wheat Market Update

📈 Prices:

• September Chicago Wheat (WU): $5.64, up 15 cents
• December Chicago Wheat (WZ): $5.84, up 14 3/4 cents
• September/December Spread (WU/WZ): -20, up 1/4 cent
• Government data from Ukraine shows wheat exports in the 2024/25 marketing year that ended Monday at 15.723 MMTs, which is down just under 18% from last year. USDA currently sees Ukraine's 2025/26 wheat exports at 16.5 MMTs.

📋 Market Headlines:

Summary:

US wheat harvest will likely surpass the 75% mark in the coming days, meaning the market could be past the heaviest of the seasonal selling pressure. However, ongoing cash price weakness in Europe and Russia still looks to potentially the upside in the short term, as any rally in US prices comes at the expense of export competitiveness.