Grain Markets and Other Stuff

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🌾 Wheat futures tumbled Thursday as KC HRW led the selloff, dropping nearly 20 cents, while SRW held up better with only a 5-cent loss. Rain hit parts of western KS and eastern CO, but many on the ground say it may be too little, too late. 👀 The Kansas Wheat Commission crop tour is coming up next week!

🌽 Corn and soybeans bounced back late Thursday after hitting daily lows, with Dec26 corn recovering from $4.83 to close near $4.895/bu. Nov26 soybeans also clawed back about 9 cents from their lows.

💣 Geopolitical tensions flared near the Strait of Hormuz as US and Iranian forces clashed Thursday. No ships were hit, and a ceasefire technically remains in place — but WTI crude is trading near $94/bbl this morning after bottoming at $89.85/bbl. Iran is expected to respond to a US peace proposal within days. 🛢️

🇧🇷 Brazil's corn crop is shrinking. Agroconsult pegged production at 140.5mmt, down 7% year-over-year, with the key second crop on track to fall nearly 10%. USDA sits at 132mmt — a big gap between the two estimates.

🌧️ Drought continues to grip the Plains. 70% of US winter wheat acres are now in drought, and conditions deteriorated further in NE, KS, and OK last week. The Corn Belt stayed mostly dry, which helped planting progress.

🚢 A rare hantavirus outbreak on a cruise ship has health officials monitoring dozens of passengers across at least 5 US states. The Andes virus strain is unusual because it can spread person-to-person. WHO says overall public risk remains low. 🦠

📉 Export sales came in soft. Corn sales totaled 1.3mmt for the week ending April 30 — down 15% week-over-week. Soybean sales hit a marketing year low at just 141,900mt, while wheat sales also missed expectations at 78,800mt.

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🌱💰 Fertilizer companies are cashing in on the Iran conflict. CF Industries and Nutrien both reported roughly 20% increases in quarterly sales as nitrogen fertilizer prices surged. Both companies also posted substantial gains in adjusted EPS. Since the conflict began, urea prices in New Orleans have jumped about 36%. 📈 Meanwhile, US natural gas prices haven't risen as sharply as other regions, allowing fertilizer producers to capture stronger profit margins. Despite elevated prices, fertilizer demand is expected to stay strong as farmers still need nutrients to maintain crop yields.

☮️🛢️ The US and Iran may be nearing a peace agreement. Washington submitted a one-page memorandum of understanding outlining a plan to gradually reopen the Strait of Hormuz and lift the US blockade on Iranian ports. Iran has not yet accepted the proposal, with leadership indicating parts of the deal are unrealistic. 📉 The announcement sent stocks surging and oil prices tumbling—US crude fell roughly 7% to settle near $95/bbl. The nearby Jun26 WTI contract trades near $93/bbl this morning after peaking above $105/bbl earlier this week. That $12/bbl selloff in less than 24 hours weighed heavily on the grain complex.

🌽📉 Grain futures tumbled Wednesday on peace deal prospects. The Dec26 corn contract fell nearly 11 cents to settle at $4.90/bu. The Nov26 soybean contract declined 14 cents to close near $11.76/bu. Traders are watching next week's Trump-Xi meeting, though the likelihood of China returning to buy large volumes of US soybeans remains low. 🌾 Wheat also moved lower—Jul26 Chicago wheat fell ~11 cents to $6.17/bu, while Jul26 Kansas City wheat slipped 3 cents to $6.87/bu.

⛽ US ethanol production ticked up last week. Weekly output came in at 1.02 million barrels per day, up 1% vs. the prior week but down 2.2% vs. the same week last year. Ethanol stocks rose to 26.02 million barrels, +1% week-over-week and +2.5% year-over-year. Ethanol margins across the Corn Belt remain strong at 5 to 45 cents positive based on Reuters data.

🇧🇷🌱 Brazil's soybean acreage is projected to increase only slightly in 2026/2027. Rising fertilizer costs driven by the Middle East conflict are limiting expansion incentives. Additionally, the potential for a strong El Niño is weighing on acreage decisions — this weather pattern would raise drought risk in northern and west-central regions while increasing excessive rainfall risk in southern Brazil.

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Oklahoma's winter wheat crop is on track for a historically poor season, with crop tour estimates coming in at 47.8 million bushels — nearly half the 10-year average and down 55% from last year, despite farmers planting 6% more acres. Dry conditions continue to grip the region, with 84% of the state experiencing some level of drought. The Kansas wheat tour is up next, where similarly disappointing numbers are expected. Meanwhile, the Texas wheat crop is battling both drought and a widespread disease outbreak tied to the wheat curl mite, with 56% of the crop rated poor to very poor.

In Europe, corn futures surged to a near two-year high amid supply concerns, with French acreage expected to fall ~15% and Romania's crop projected to be its smallest in over a decade. High fertilizer costs linked to the Strait of Hormuz closure are a major driver. Back in the US, corn and soybean futures pulled back Tuesday on farmer selling and lower crude prices, while wheat futures slipped on forecasted Plains rainfall — though it's unlikely to make a meaningful dent in drought damage.

Gas prices are surging, with the national average hitting $4.48/gallon — up $1.32 from a year ago — and diesel sitting at $5.66. Crude remains above $100/barrel with no resolution in sight on the US-Iran front. Farmer sentiment dipped in April per the Purdue/CME Ag Barometer, with input costs and availability remaining top concerns. And ADM raised its 2026 outlook, citing biofuel policy tailwinds and expectations of China returning to normal soybean buying in Q4.

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Crude oil prices surged more than 4% Monday after Iran targeted US vessels and struck the UAE, reigniting fears that the four-week ceasefire could collapse. The move sent soybeans up 14 cents to near $11.97/bu and corn up roughly 6 cents to near $5.05/bu, with wheat also advancing on expected Plains rainfall.
US winter wheat conditions remain historically poor—the top 5 HRW states (KS, OK, TX, CO, NE) are rated just 14% good-excellent with 52% poor-to-very-poor. Nationally, 37% of the crop is rated poor-to-very-poor, well above the 5-year average of 27%. Corn planting reached 38% complete, ahead of the 34% average, while soybean planting hit 33%, well above the 23% average.
On the export front, corn inspections came in strong at 80 million bushels — up 22% week-over-week and 25% vs. last year. Soybean and wheat shipments came in near the low end of expectations. China accounted for roughly 45% of weekly inspections.
The US is urging China to pressure Iran to reopen the Strait of Hormuz. Treasury Secretary Bessent noted China buys ~90% of Iran's energy exports. Trump and Xi are expected to meet May 14th. Meanwhile, China ordered its companies to disregard US sanctions on private refiners tied to Iranian oil purchases.
Tyson Foods posted $260M in net income last quarter, up sharply from $7M a year ago, despite a $240M loss in its beef segment driven by tight cattle supplies. Chicken profit hit $505M. Ag Secretary Rollins flagged the administration's ongoing investigation into the big four meatpackers.

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🌽 Frost risk is rising across the Corn Belt this week as temperatures trend below normal, particularly in northern areas. Heavy rain is also expected to slow planting progress. Storm systems are forecast to bring rainfall across the central and southern Plains, though wheat yield damage in those regions has likely already occurred. The Northern Plains remain mostly dry but face below-normal temperatures and freeze potential. 

📈 Corn futures rallied Friday on rising fertilizer prices tied to the Iran war, which traders fear could reduce yields. The July '26 contract gained nearly 6¢ to settle near $4.80/bu, while the Dec '26 contract traded above $5.00/bu for the first time this year. Cold, wet conditions across the central and eastern Corn Belt added to bullish sentiment. Soybeans and wheat also closed higher. 

📊 CFTC Commitment of Traders (week ending Apr. 28): Large money managers were net buyers of 83k corn contracts — the net long of 266k is the largest since late March. Funds were net sellers of 11k soybean contracts. SRW wheat saw net buying of 20k contracts, pushing the net long to 12k—the largest since June 2022. Managed money also holds a record net long in spring wheat and is near-record net long soybean oil.

🚢 Iranian grain imports have collapsed as vessels idle at sea rather than risk transiting the Strait of Hormuz amid the US blockade. War-risk insurance costs are prohibitive. Iran, heavily dependent on imported feed grains for its meat and dairy sectors, is seeing staple food prices surge — eggs up 118% and bread up 80% since the war began. Rerouting attempts have not offset lost volumes. 

🇲🇽 Mexico replaced its agriculture minister. President Sheinbaum named Columba López Gutiérrez to replace Julia Berdegué, who moves to an advisory role as the US, Mexico, and Canada review the USMCA ahead of a July 1 deadline on whether to extend the agreement 16 years or let it expire. Berdegué had also been leading New World screwworm talks with the US — an issue with little improvement. Mexico is the largest buyer of US corn.

🌽 USDA flash sale: US exporters sold 148,240 MT (≈6 mil bu) of corn to unknown destinations — 78,240 MT for 2025/26 delivery and 70,000 MT for 2026/27 delivery.