AM Market Report – August 20, 2025

GOOD MORNING…HERE IS YOUR MORNING MARKET NEWS

OVERNIGHT GRAIN TRADE

ICE canola futures were trading slightly lower through the early morning hours…right up to 10 minutes ago…then turned up between $1 and $2/tonne. But yet sure what’s changed…or just daily market volatility. Chicago soybean futures are a penny weaker, with bean oil also down slightly. Beans are slipping on profit-taking, though the market is still underpinned by last week’s reduced US government forecast for the autumn harvest.

Chicago corn futures are mostly steady to fractionally lower this morning
as strong yield projections maintain-related supply pressure.

The Pro Farmer Crop Tour in progress and showing bountiful US corn and soybean yield potentials is limiting buying interest in the grain futures markets this week. Reality is setting in on just how big US corn and soybean crops could be this year, as actual field reports are reported. Are there some problems with the US Midwestern crops? Yes. But overall, yield comparisons from previous years show US corn yields and soybean pod counts at higher levels.

Crop weather in general through the end of August appears non-threatening.

US wheat markets are steady to trying to tick up slightly… Minnie spring wheat futures are mostly a penny or less higher, HRW is a penny higher, while SRW wheat is 1 to 3 cents higher.

While up slightly this morning, wheats continue to languish at contract lows, pressured by an upward revision to Russia’s wheat crop forecast and the uncertain state of talks to end the war in Ukraine. On Monday, Russia’s IKAR consultancy raised its 2025 wheat crop forecast to 85.5 MMT from 84.5 MMT, reinforcing expectations that the world’s biggest wheat exporter is set for a large harvest despite a disappointing start.

In Other News

– Where it stands today: Russia and Ukraine conflict… After a mini-NATO delegation descended on Washington this week to smooth the meeting between US President Donald Trump and Ukrainian President Volodymyr Zelensky (stop Trump from doing something crazy like last time), attention has turned to the security guarantees that might be offered to Ukraine. To deter Russian attacks under a peace deal, European leaders keep pitching a “reassurance force” that looks a lot like NATO’s collective defence pledge…and yesterday, the White House said it could be backed by US air support. American boots on the ground are off the table. NATO’s military chiefs will hold a video meeting later today to discuss options for Ukraine.

The likelihood of a deal: For all of Monday’s White House pleasantries, the delegation didn’t leave with a clear road map for peace. The sticking points in this three-year war remain: Russian President Vladimir Putin wants territory concessions, which Kyiv has rejected; Zelensky wants Western peacekeepers on its soil, which Moscow maintains is a red line. A hot mic did catch Trump telling French President Emmanuel Macron that he thought “Putin wants to make a deal for me, as crazy as that sounds.” But on Fox & Friends yesterday, Trump seemed to reconsider, saying “it’s possible he doesn’t want to make a deal.”

What’s next: Probably not a ceasefire between Russia and Ukraine, which Trump now insists isn’t necessary either for a longer-term peace deal or as a condition for further talks. But he said Putin has agreed to a face-to-face discussion with Zelensky in the coming weeks. The meeting might be in Budapest, it might be in Geneva, or it might not happen at all…the Kremlin played down its possibility yesterday.

– FCC extends support for canola producers… Farm Credit Canada has extended its Trade Disruption Customer Support program to canola producers. The federal crown lender announced that its decision comes after continued global trade disruption, including new Chinese tariffs on canola seed. Chief executive officer Justine Hendricks said the uncertainty creates real pressure on cash flow and operations for farms, agribusinesses and food processors. “Our role is to ensure our customers, and the broader industry, have access to the capital and flexibility they need to adapt, stay competitive and keep delivering high-quality products to markets at home and abroad,” she said.

Existing customers and new clients who meet the lending criteria are eligible for the additional help. This includes access to an additional credit line of up to $500,000 and new term loans. Existing customers may defer principal payments for up to 12 months on their loans.

FCC said it will continue to work with industry partners to navigate changing market conditions.

– US soybean farmers urge Trump to make purchase deal with China... US soybean farmers urged President Trump in a Tuesday letter to reach a trade deal with China that secures significant soybean purchase agreements, warning of dire long-term economic outcomes if the country continues to shun the US crop. China, the world’s largest soybean buyer, is turning to Brazilian cargoes amid trade tensions with the US and ongoing negotiations. The country has not pre-purchased any US soybeans from the upcoming harvest, an unusual delay that has worried traders and farmers.

“Soybean farmers are under extreme financial stress. Prices continue to drop and at the same time our farmers are paying significantly more for inputs and equipment. US soybean farmers cannot survive a prolonged trade dispute with our largest customer,” said the letter sent from the American Soybean Association to Trump on Tuesday.

Soybean prices jumped after an August 11 post from Trump on Truth Social urging China to quadruple its soybean purchases. However, farmers said they doubted such a large increase was possible. “The further into the autumn we get without reaching an agreement with China on soybeans, the worse the impacts will be on US soybean farmers,” said the letter.

– China July soybean arrivals from Brazil rise… China’s soybean imports from Brazil rose 13.9% in July from a year earlier, customs data showed, while supplies from the US fell 11.5%. The world’s top soybean buyer imported 10.39 MMT of the oilseed from Brazil last month, or 89% of the total imports, compared with 9.12 MMT a year earlier. July arrivals from the US stood at 420,874 tonnes, down from 475,392 tonnes a year earlier. Overall July imports hit the highest level ever for that month at 11.67 MMT.

China has not pre-purchased any soybeans from the upcoming US soy harvest due to high tariffs, an unusual delay that traders warn could see US exporters risk missing out on billions in sales as buyers lock in Brazilian cargoes for shipment during the key US marketing season.

– US Pro Farmer Crop Tour, Day Two… Pro Farmer crop scouts on Tuesday measured the Indiana average corn yield potential at 193.82 bu/acre. Soybean pod counts in a 3′ x 3′ square averaged 1376.59. In Nebraska, scouts measured average corn yield potential of 179.50 bu/acre. Pod counts in a 3′ x 3′ square averaged 1348.31. The Nebraska and Indiana corn crops this year were more than 10 bu above the three-year Tour averages, and both are more than 3% higher than last year’s Tour numbers. The western leg this year continues to show more consistency in yield potential than the eastern leg. It appears more-than-adequate moisture is pulling up dryland yields in Nebraska, while wet spots caused unevenness in Indiana. The in-field survey work in both states also led to above average soybean ratings. Nebraska pod counts in 2025 beat the previous record from 2010.

– Manitoba harvest hits 4% complete… Isolated rainfall and storm events brought both relief and delays to Manitoba farmers once again this past week, as harvest progress reached 4% complete across the province. The Central Region led harvesting at 7% complete as of Monday, followed by the Interlake at 6%. The Eastern Region was 4% complete, the Southwest 2%, and the Northwest 1%. Provincewide, winter wheat and fall rye were both 52% harvested, while barley was 8%, oats 4%, spring wheat 6%, and peas 19%. Early seeded canola harvesting has also begun in the Central region.

– Saskatchewan lentils, peas in good condition… Harvest operations have already begun in Saskatchewan, with pulse crops in most parts of the province deemed in good condition. Early indications suggest this year’s pulse crops will look very good as harvest progresses.

Dale Risula, Sask Ag pulse specialist said that while the southwestern part of the province had below-normal precipitation during the growing season, most of Saskatchewan saw sufficient moisture levels and satisfactory crops. “The rest of the province is fairly decent. The crop looks like it’s going to generate a fairly decent yield and it will have good quality as well,” he said.

Earlier seeded crops had to face the brunt of hotter temperatures earlier this summer and matured faster, meaning that later seeded crops benefited more by late-season rainfall. As a result, crops seeded later seem to have better yield.

Risula also mentioned that the lentil crop has largely withstood the early heat. He also believes the warmer temperatures helped ward off root rot.

– New rules slow shipments from major Russian grain export port… Russian grain exports via the Black Sea port Kavkaz, which accounted for almost a quarter of all seaborne exports last season, have been significantly hampered this month due to new ship entry and inspection requirements, industry sources said. Foreign vessels require permission from port authorities and approval of Russia’s FSB security service to enter the country’s ports, according to a decree in July by President Vladimir Putin. Since the beginning of August, around 350,000 tonnes of grain have been shipped through Kavkaz, compared with 1.5 to 2 MMT a month during the northern hemisphere summer and autumn. At the beginning of last week, more than 120 ships were waiting to pass through the port, and freight rates for coastal vessels were rising, with terminals overflowing with grain and had effectively stopped accepting more.

Kavkaz port is located in the northern part of the Kerch Strait which connects the Sea of Azov and the Black Sea. Ships pass under the Kerch Bridge on their way to the port, requiring additional inspections for security reasons.

– US AGs urge Trump EPA to drop plan to kill greenhouse gas rules…Attorneys general from California and several other US states led by Democrats on Tuesday urged President Donald Trump’s administration to abandon its plan to rescind the long-standing finding that greenhouse gas emissions endanger human health, a move that would remove the legal foundation for all US greenhouse gas regulations. If finalized, repeal of the finding by Trump’s Environmental Protection Agency would end current limits on greenhouse gas pollution from vehicle tailpipes, power plants, smokestacks and other sources.

Outside Markets

The Dow Jones Industrial Average ticked up a modest 10.45 points on Tuesday to settle at 44,922.27, while the S&P 500 shifted 37.78 lower at 6,411.37. Early Wednesday, the September Dow Jones Futures are up 90 points.

US stock index futures are mixed this morning (Dow up, S&P 500/Nasdaq down slightly), while European and Asian stock markets were also mixed overnight. Global markets came under recent pressure after a tech-led sell-off on Wall Street yesterday and as investors anticipate comments by US Federal Reserve chairman Jerome Powell on the direction of US interest rates on Friday. Canada’s TSX stock index futures are also little changed this morning at all-time highs.

Yesterday’s StatCan inflation report has left economists thinking that a Bank of Canada interest rate cut is more likely to happen next month.

While there was no immediate trigger behind the selloff in technology stocks, analysts pointed to a confluence of factors, including US President Donald Trump’s growing influence over the sector and a general risk-off mood.

The September US Dollar Index is down 0.079 at 98.040. The Canadian dollar weakened against its US counterpart…currently quoted at 72.25 US cents..

October crude oil futures are up $0.81 at US $62.58/barrel. Oil prices were up as the American Petroleum Institute reported a drop in US crude inventories and investors awaited the next steps in talks to end the Ukraine war, with sanctions on Russian crude remaining in place for now.

Grain Markets

Chicago soybean futures are easing a penny lower this morning. Bean futures lifted off session lows on Tuesday, but still closed with 6 to 8 cent/bu losses. Soymeal futures are up around $1/ton this morning after gaining Tuesday. But soyoil futures are modestly adding to yesterday’s sharp 98 to 159 points losses with further 15 to 24 point declines this morning.

As the US soybean harvest approaches, the trade is becoming increasingly that China, the US’s No. 1 soy export customer, is nowhere to be found. Beijing continues to lean on Brazil for beans because of the tariff tensions with the US. China’s absence has sparked the American Soybean Association to urge President Trump in a letter on Tuesday to do something.

The USDA’s US national soy crop rating held this past week, and development is close to normal, but some areas need rain to meet the USDA’s record yield projection. Near-term forecasts generally have scattered rain in parts of the US Midwest and Plains.

Chicago corn futures are steady to a penny weaker this morning. The corn market closed out Tuesday’s session with contracts down 3 to 4 cents, as the market tries to digest some of the current boots on the ground data. This week’s Pro Farmer crop tour of the US Corn Belt has so far turned up strong yield potential, backing up USDA’s monster US corn crop projections.

While export demand for US corn remains solid, there’s about to be more competition from Brazil. That second crop harvest is about to wrap up with record production thanks to increased acreage and an all-time high for average yield.

In addition to that solid export demand, feed and fuel demand is good.

US wheat markets are trying to edge up higher this morning, though futures are generally still wallowing at contract lows. But Minnie spring wheat futures are trading mostly around a penny higher this morning, HRW is also up a penny, while SRW wheat now 1 to 3 cents higher. But wheat is still a bear market overall, with the US wheat complex dropping Tuesday across all three markets…spring wheat down 2 to 3 cents yesterday across the front months. US prices are competitive on the world market, and recent US export sales reports have shown the business, though the market has had only a muted reaction, with ongoing pressure from rising world supplies canceling out oversold signals.

Price pressure is coming from rising major exporter wheat supplies, with IKAR, a Russian-based consultancy, raising Russian wheat production by 1 MMT to 85.5 MMT. Russian cash values are falling as both the EU and Russia fight for limited business.

North America’s spring wheat harvest is getting underway…caught up to the average pace for the northern US Plains…and on the cusp of getting going in the Canadian Prairies. The trade is also watching harvest activity in Europe, Russia, and Ukraine, along with development conditions in Argentina and Australia. No real problems anywhere. As an example…a German grain union pegs 2025 wheat production at 21.7 MMT, compared to 17.8 MMT in 2024.

CANADIAN GRAIN MARKET

ICE canola futures fell for the second straight day on Tuesday. Declines in Chicago soybeans and soyoil pressured the Canadian market, as did declines in European rapeseed and palm oil. Crude oil was weaker on the day as well.

A Reuters report said trade volume in canola remains relatively light following last week’s blindside announcement from China of a prohibitive anti-dumping duty on imports of Canadian canola. On Monday, it was reported that China had made a purchase of Australian canola for the first time since 2020.

November canola fell $5.70 yesterday to close at $646/tonne, and January was down $5.80 at $657.50.

For today… canola futures were slipping another $1 to $2/tonne lower through the early morning trade…but have suddenly and inexplicably turned $2/tonne higher on the front months as this report goes out. Nov canola is now up $2.30 at $648.30/tonne, tipping below its 200-day moving average ($649) yesterday and operating at its lowest level since the middle of April. Unless something changes…and quick…this leaves the prospect of the Nov contract selling down the $620 to $630/t level. Spec funds continue to liquidate their net long position in canola futures as chart technicals continue to erode.

The canola sector remains shaken by the big China tariff announcement last week against Canada…75.8%…effectively shutting down business to that key outlet for the foreseeable future. The Canadian government so far has been ineffectual in response.

The slide lower this month in CBOT soyoil futures is also of grave concern to canola traders…appears to be anxiety over expected rulings later this week on Trump administration Small Refinery Exemption rulings. The concern is that if it was too easy to get an exemption, it would cut into actual US biodiesel and renewable diesel demand. The recent backslide in CBOT soyoil futures has pressured the Dec contract below the chart notable 52.00 cent/lbs market…this morning down 21 points at $51.60 cents/lbs…looking to fill the chart gap left in June.

Bit of mish-mash of related outside influences…CBOT soybeans/soyoil lower, EU rapeseed steady to slightly higher, Malaysian palm oil slightly weaker (though just off contract highs), while crude oil is higher.

To access the latest futures prices, go to https://www.producer.com/markets-futures-prices/