AM Market Report – July 15, 2025 | The Western Producer

GOOD MORNING…HERE IS YOUR MORNING MARKET NEWS

OVERNIGHT GRAIN TRADE

ICE canola futures are posting mostly $2 to $3/tonne gains this morning, trying to bounce from last week’s big push lower. Chicago soybeans are trading mostly fractionally to a penny per bu lower, with bean oil edging higher. Bean futures have fallen to a 3-month low.

Chicago corn futures have pulled back from Monday’s corrective gains…trading 2 to 4 cents lower. Bargain buying and short-covering lifted corn futures on Monday after the market slid to contract lows on expectations for strong US output.

US winter wheat futures extended their recent losses…down 2 to 4 cents this morning, while spring wheat futures are narrowly mixed.

Favorable US weather conditions have hung over the corn and soy markets and fueled expectations for bumper autumn harvests. Commodity Weather Group said rain this week will reduce dryness in the important Midwest region.

After the close of trade on Monday afternoon, the USDA issued their updated weekly US crop condition ratings following another week of generally favorable development conditions in much of the US Midwest and Plains.

The USDA says 74% of US corn is in good to excellent condition, steady with the previous week. 70% of US soybeans were called good to excellent, 4 points more than last week.

63% of US winter wheat was harvested as of Sunday, just behind average. 54% of US spring wheat was deemed in good to excellent shape, 4 points higher than last week and better than expected.

Traders are also monitoring US President Donald Trump’s tariff threats amid worries that importers may retaliate by limiting purchases of American farm goods.

In Other News

– Russia-Ukraine war update… US President Donald Trump seems to have reached a new conclusion about Russia’s Vladimir Putin: For all their pleasant conversations, the Russian President has no real interest in ending his war in Ukraine. So Trump decided to dispense with the carrot…praising Putin as a “genius” who should be invited back into the G7…and instead try his hand at the stick. In an Oval Office press conference yesterday alongside NATO Secretary-General Mark Rutte, the Trump announced a deal to provide more US-made weapons to Ukraine, with NATO members footing the bill.

Details remain relatively scarce: Trump said the US would send over “billions” of dollars of “top of the line” equipment, including Patriot missile defence systems, that would be distributed quickly to the battlefield. Rutte added that many NATO allies, Canada among them, signalled they want to be part of rearming Ukraine. So all NATO members, except the US, are shouldering the cost here.

One specific threat, however, was issued to Moscow. Trump insisted that the US would impose 100% tariffs on Russia unless Putin reached a ceasefire in 50 days.

But it’s hard to know how committed Trump is to the Sept. 2 deadline…he’s doled out plenty of tariff reprieves over the past few months. He has also threatened US sanctions on Russian on a number of occasions…Putin laughed at him and kept bombing the Ukrainians…then Trump did nothing each time (TACO).

However, there is currently a bill in the US Senate that would impose sanctions on any country that buys oil from Moscow, including China and India, which would deal a bigger blow to Russia’s economy. Trump didn’t mention these sanctions directly in the Oval Office yesterday, but a White House official said they were on the table.

– Canada’s foreign affairs minister spoke with Chinese counterpart…Canada’s minister of foreign affairs spoke with her Chinese counterpart while in Malaysia last week. Anita Anand visited Kuala Lumpur, Malaysia to meet with members of the Association of Southeast Asian Nations (ASEAN).

Back in March, China has placed 100% tariffs on Canadian canola oil and meal and peas, and 25% tariffs on Canadian pork and seafood. The move was in response to Canada’s 100% tariff on Chinese electric vehicles and 25% tariff on Chinese aluminum and steel products.

– EU targets Boeing, bourbon for potential tariffs on US goods… The European Commission is targeting US $84.1 billion worth of US goods…from Boeing aircraft and bourbon whiskey to cars…for possible tariffs if trade talks with Washington fail. US President Donald Trump is threatening a 30% tariff on imports from the EU from August 1, a level European officials say is unacceptable and would end normal trade between two of the world’s largest markets. The list, sent to EU member states on Tuesday, pre-dates Trump’s move over the weekend to ramp up pressure on the 27-nation bloc and responds instead to US duties on cars and car parts and a 10% baseline tariff. The package also covers chemicals, medical devices, electrical and precision equipment as well as agriculture and food products…a range of fruits and vegetables, along with wine, beer and spirits.

Following a meeting of EU ministers in Brussels on Monday, officials said they were still seeking a deal to avoid Trump’s heavy tariff blow. But EU trade chief Maros Sefcovic said those at the meeting expressed unprecedented resolve to protect EU businesses using European countermeasures if negotiations with Washington fail to produce a deal.

– Cordonnier raises US corn, soybean yield forecasts… Weather conditions through the first half of July have been “nearly ideal” and the US corn crop is “on its way to a record yield.” Therefore, crop consultant Dr. Michael Cordonnier raised his national US corn yield average by 2 bu to 182 bu/acre, increasing his corn production forecast to 15.79 billion bu. While US soybean conditions aren’t quite as high and key August weather lies ahead, Cordonnier raised his US soybean yield average by 1 bu to 52.5 bu/acre, increasing his production forecast to 4.33 billion bu.

– Russian wheat export prices rise… Russian wheat export prices rose last week amid the slow arrival of the new crop and low yields in the southern part of the country, while export shipments accelerated slightly. The price for new crop Russian wheat with 12.5% protein content for free-on-board (FOB) delivery in August was US $229/tonne at the end of last week, up $4 from the previous week’s prices, said the IKAR consultancy. The SovEcon consultancy estimated new crop offers at $228-$230/tonne, compared with $225–$228 in the prior week.

“Later last week, wheat prices found support from growing concerns over the Russian crop outlook,” SovEcon noted. As of July 4, yields in southern Russia, a key wheat-growing and exporting region, remained low. Its analysts noted that yields will increase as harvesting progresses. Only 9% of the area has been harvested in the southern regions of Russia, compared to 40% last year at this time. In addition, the situation in southern Russia may be partially compensated by yields in the center of the country and the Volga region, where they are above average.

Based on the results of the first week of July, analysts last week noted extremely low volumes of wheat exports from Russia at the beginning of the season, with harvesting starting slowly and farmers showing reluctance to sell at current prices.

The export duty on wheat, which the Russian Ministry of Agriculture calculates weekly, will remain zero for the second week in a row until July 22.

– Russia’s seaborne grain exports drop 25% in 2024/25… Russia’s seaborne grain exports fell by 25.4% in the recently ended 2024-2025 season to around 46 MMT, according to shipping data from industry sources. Russia, the world’s leading wheat exporter, delivered grain to global markets at record volumes early in the 2024/25 marketing season, which ran from July 1, 2024 to June 30, 2025. However, the implementation of export quotas in February and lower crop output caused a sharp decline in the season’s final months. Shipments in June fell by 72% to only 1.45 MMT, according to the data. Exports via Black Sea terminals, which normally account for around 90% of all seaborne grain shipments, decreased by 25.1% year-on-year to 41.6 MMT for the season.

Overall grain exports for the 2024/25 season (including land shipped) will be around 53 MMT, including 44 MMT of wheat, and grain exports for the next season are forecast to reach 53 to 55 MMT, Russia’s agriculture ministry said last month. Russian wheat exports are expected to get a boost following a reduction in an export tax to zero, reflecting the rouble’s strength as well as low global prices.

– CHS shutters US Duluth-Superior grain terminal… In a blow to the US Port of Duluth-Superior, CHS confirmed it is ceasing operations at its Superior, Wisconsin, grain terminal by the end of August 2025. The CHS grain terminal was built in 1936 in Superior, Wisconsin. It is the largest grain shipper in the Superior port, handling about 60% to 70% of the port’s total grain volume. CHS Superior has 18.5 million bu of storage capacity and loading capacity of 80,000 bu per hour.

CHS senior vice president of global grain marketing John Griffith told the Minnesota Star Tribune, “There’s not critical mass of grain flowing through the Port of Superior, or our facility in particular, that supports the facility. There are more efficient and less expensive ways to transport grain. Shuttle trains can carry grain to deep-water facilities that can accommodate ships larger than those that travel through the locks of the Great Lakes.”

Outside Markets

The Dow Jones Industrial Average posted an 88.14 point gain at the close Monday at 44,459.65, while the S&P 500 Index edged up 8.81 points to 6,268.56. Early Tuesday, September Dow Jones futures are up a modest 9 points.

US stock index futures are slightly higher this morning, with European stock markets also turning up. Investors are eying key US earnings, inflation data from both the US and Canada and continuing trade talks.

US inflation heated back up in June, rising to its highest level in four months, as higher prices…including those from Trump tariffs…packed a bigger punch. US consumer prices rose 0.3% from last month, pushing the annual inflation rate higher to 2.7%, the highest since February, according to the Bureau of Labor Statistics.

TSX futures pointed higher after Canada’s main stock market reach a new high yesterday. StatCan this morning reported the annual pace of inflation in Canada accelerated to 1.9% in June year-over-year. The June price hike is up from 1.7% rise in May, though was largely in line with economists’ expectations.

Excluding energy, annual inflation was 2.7% in June. The removal of the consumer carbon price at the start of April continues to dampen the annual price comparisons.

The June figures mark the final look the Bank of Canada will get at price data before its next interest rate decision on July 30.

Despite some market optimism, “risks are piling up: the risk of global supply chain disruptions, a tariff-led jump in US inflation, pressure on company earnings, an unsustainable surge in G7 debt levels, political risks, geopolitical risks,” Ipek Ozkardeskaya, senior analyst at Swissquote Bank, wrote in a note. “Something has to give…but when and where remains the big unknown. It’s worth watching the economic data, the earnings, and global yields closely.”

The September US Dollar Index is up 0.002 at 97.765. The Canadian dollar strengthened against its US counterpart…currently quoted at 73.16 US cents.

August crude oil futures are down $0.39 at US $66.39/barrel. Oil prices are weaker this morning after US President Donald Trump’s announced a lengthy 50-day deadline for Russia to end its war with Ukraine and avoid sanctions…easing immediate supply concerns.

Grain Markets

Chicago soybean futures are trading fractionally to a penny lower this morning. Bean futures slipped lower on Monday, with contracts fractionally to 4 cents/bu in the red. Nov bean futures are 0.75 cents lower this morning at $10.06bu, and appear destined for another test down to psychological chart support at $10.00. Soymeal futures are down less than $1/ton this morning, while soyoil is edging up 14 to 27 points after finishing 25 to 42 points higher on Monday.

The weather and US crop condition situation stands as the most apparent roadblock to higher prices for the soybean market, with Monday’s weekly USDA conditions update showing a 4 point increase in good to excellent ratings for the crop to 70%. And also…rains are expected to be rather widespread this next week across the US Midwest according to NOAA’s 7-day forecast, with much of the Corn Belt seeing 1 to 3 inches.

US soybean export inspections reported yesterday for the latest week fell below the week previous and last year, reflecting the lack of demand from China and the faster pace of shipping earlier in the marketing year.

On the plus side though…US domestic crush demand should remain strong on soyoil demand expectations tied to rising US biofuel production targets. USDA on Friday made some major changes to its US soyoil demand assumptions for 2025-26, which starts October 1. The agency cited recent blending mandates, as well as tax credits and curbs on foreign feedstock imports. US soyoil use for biofuels is predicted to reach a record 15.5 billion pounds in 2025-26, up 23% on the three-year average and up 12% from USDA’s June estimate. The agency slashed 2025-26 export expectations to accommodate the boost in domestic demand.

The new figures show biofuels in the upcoming year accounting for more than half of all US soyoil use for the first time in history, near 53% worth.

As such, US soybean processing in 2025-26 is set for a new record of 2.54 billion bu. That would represent 58% of total domestic disappearance, the largest share in 18 years, further displacing exports.

Chicago corn futures are trading 2 to 4 cents lower this morning…giving back much of Monday’s 4 to 6 cent rebound gains.

Traders are torn between Friday’s relatively bullish supply/demand forecasting from USDA and an as of yet non-threatening weather forecast through US corn pollination for most of the Corn Belt. For weekly conditions, USDA held the national average at 74% of the crop rated good to excellent, still very strong for mid-July over recent history. And also…crop building rains are expected to be rather widespread this next week according to NOAA’s 7-day forecast, with much of the Corn Belt seeing 1 to 3 inches.

Demand for US corn remains strong though. Weekly US corn export inspections Monday were solid and keeping the year-to-date 2024-25 export pace at 30% ahead of 2023-24.

US wheat markets are generally weaker this morning…SRW down 3 to 4 cents, HRW losing 2 to 3 cents, while spring wheat futures are narrowly mixed (penny or less either side of unchanged). Wheat finished lower across the three US markets on Monday…spring wheat down 10 to 11 cents yesterday. Spring wheat is trying to steady itself after an ugly two-day price rout which amounted to 28 cents lost for the September contract.

Harvest pressure in the US, as well as for the recently increased Russia and European crops, will keep a firm hand on winter wheat prices in the immediate outlook.

Monday afternoon’s weekly crop progress report from USDA showed the US winter wheat crop at 63% harvested, 1% below the 5-year average pace. The spring wheat crop was 78% headed, 3% ahead of normal, with conditions up 4 points to 54% good/excellent.

Recent increased rainfall across the northern US Great Plains has weighed on spring wheat futures. USDA on Monday reported spring wheat conditions in Minnesota, Montana, South Dakota, and North Dakota all showed improving crop ratings. However, the PNW region continues to struggle with drought.

Additionally, traders are monitoring development weather and/or harvest activity in Argentina, Australia, Canada, Europe, Russia, and Ukraine.

CANADIAN GRAIN MARKET

ICE canola futures ended with small losses on Monday, as the market continued to stabilize following last week’s volatile and bearish action.

Some of the pressure on the market yesterday came from improving Prairie weather. According to World Weather, rain that began Sunday…and is expected to last into Tuesday…should bring some relief to areas from southwestern Alberta to southwestern Saskatchewan. Additional rainfall is forecast for western Alberta and the Peace River Region later this week.

Friday’s Alberta crop report showed some improvement in major crop conditions in the province, including canola.

Chicago soybeans and soymeal were also lower on Monday, but advances in crude oil, soyoil, palm oil and European rapeseed helped to limit the declines in canola.

November canola eased only a dime yesterday to close at $682.60/tonne, and January lost 20 cents to $690.90.

For today… canola futures are rebounding $2 to $3/tonne higher this morning. Benchmark Nov canola futures are up $1.90 at $684.50/tonne right now, but seems only corrective consolidation trade for now after declining precipitously since June 19. Hopefully, upward momentum holds today, and can be built upon. But chart momentum indicators remain bearish…though some flagging of short-term oversold conditions.

Concerns over long-term supply and demand implications are providing some underlying price support. Reports of improving weather prospects…rains to start this week across the Prairies…are being noted, though not sure what impact they have had on overall crop condition.

In related markets… CBOT soybeans are slightly weaker this morning, though soyoil is pushing a bit higher and maintaining 20-day moving average support. EU rapeseed is up slightly, though Malaysian palm oil is lower on shipping data that indicates slower than expected exports in the first half of July.

Managed money spec funds sold a net of 14,713 contracts during the week ended July 8. The funds position now stands at 123,506 contracts net long for canola. While off the recent higher, it was still the largest net long canola position held by the funds for this week on record. The drop in the futures market last week raised concerns that the funds were liquidating their record long position.