Calmer Markets, Bigger Questions: Are Grains Losing Their Bullish Edge Despite Positive Day?

A quiet but constructive mid-week session saw corn and soybeans post modest gains overnight heading into Wednesday's trade, while wheat remained under pressure from improving Plains rain forecasts and an easing of the Middle East war premium. The market backdrop continues to evolve around three dominant themes, the fragile Iran ceasefire and its ongoing impact on energy and fertilizer costs, faster than normal US planting progress putting early bearish pressure on corn, and a continued lack of Chinese new-crop bean purchases that keeps the soybean fundamental picture clouded.

News and Notes:

• Forecasts have rain across parts of the Southern Plains up to the Great Lakes this week. While it may slow planting down for a couple days the rain is much needed in many areas and a welcome trade-off.
• The daily November soybean futures chart on page 2 shows today’s close over the 20-DMA (red line) and you can see the range it has been trading in the last few weeks.
• The week-old Iran ceasefire remains the most important variable in every commodity market, and it remains deeply uncertain. The Strait of Hormuz is still virtually closed to normal commercial traffic despite the two-week truce, with tanker flow crawling along at a fraction of pre-war levels as insurance markets, Iranian vetting procedures and the ongoing Israeli strikes in Lebanon all complicate re-opening. The fertilizer market has stabilized but has not broken lower. The ceasefire gives hope, but the supply chain damage is not a switch that gets flipped overnight, and the June planted acreage report is likely to reflect some last-minute acre shifts from corn to soybeans as those economics bite.
• Soybeans continue to be caught between a record South American supply wave and the hope that a Trump-Xi meeting eventually unlocks Chinese new crop purchases. Brazil's CONAB raised its 2025-26 production estimates again this week and harvest is now more than 65% complete, with total production expected to exceed 6.5 billion bushels, a record that will flood world markets in the coming months.
• Weekly ethanol production equaled last week but was up 11% from last year, continuing to keep production higher this year than the past couple. US crude oil stocks rose to 464 million barrels, a near decade high.

The market has settled into a new normal since the ceasefire, less violent day-to-day swings but still fundamentally driven by Iran headlines and their impact on energy, fertilizer and the broader commodity complex. Corn's record export pace (running 36% ahead of last year) is the most constructive fundamental input in the entire grain complex right now, and it will be tested by Thursday's weekly export sales report. Beans need China and China needs a reason to act, and until the Trump-Xi meeting produces something tangible that remains a problem with no clear timeline. The favorable planting weather and early pace are keeping the lid on corn moving higher in the near term. For now, the path of least resistance is sideways to lower, and any rallies driven by Iran headlines should be used as selling opportunities.