AM Market Report – August 28, 2025

GOOD MORNING…HERE IS YOUR MORNING MARKET NEWS

OVERNIGHT GRAIN TRADE

ICE canola futures are trading $4 to $6/tonne lower to start this morning…the fourth consecutive session of trending lower.

Chicago soybean futures are steady to a penny weaker. Soybean bulls are trying to maintain the recent price uptrend. But no news is not good news when the US meets with China’s trade negotiators. The entire soybean industry waits on the edge of its seats for China to announce US soybean purchases…something the market has seriously been lacking.

Chicago corn futures are fractionally to a penny lower this morning. The trade is uncertain about what to think about the disease issues in US cornfields and the mixed weather in the Corn Belt for the next ten days. The corn market bulls are in some near-term technical trouble as the price uptrend on the daily bar chart for December corn has stalled. Bulls need to show power yet this week to keep that uptrend alive.

US farmers are on track to harvest the nation’s biggest corn crop in history this autumn, as well as a bumper soybean crop.

US wheat futures markets are mostly 1 and 3 cents lower, led by the winter wheats. The wheats continue their price downtrends and are being led by hard red winter…and now also spring wheat…pressing to fresh contract lows…weighed down by large global harvests and favorable weather in growing areas.

In Other News

– Canada Crop Production estimates… Statistics Canada this morning released their first Canadian crop production forecasts for 2025 based on yield model estimates using satellite imagery and agroclimatic data (no farm survey). According to this morning’s report, Canadian farmers are projected to produce more canola, corn, oats and lentils, but less spring wheat, durum wheat, soybeans and barley, compared with 2024.

In general, crop conditions across the Canadian Prairies have been variable throughout the growing season. In some areas, lower-than-average precipitation and prolonged high temperatures have resulted in below-average crop conditions as of the end of July, while parts of Western Canada that received sufficient precipitation saw above average crop conditions.

In Alberta, provincial reports indicated that almost two-thirds (64.8%) of major crops were rated as being in good to excellent condition at the end of July, above the five-year average for the period (52.9%). However, some areas lacked sufficient moisture, and this is likely to impact yield. In Saskatchewan, sufficient rainfall in some parts of the province resulted in normal crop development, while moisture stress attributed to dry conditions is reported to have resulted in some crops maturing ahead of normal. Parts of Manitoba received less than half the normal amount of precipitation throughout the growing season as of the end of July, and this, combined with high temperatures early in the growing season, may have impacted yields for some crops.

Wheat

Nationally, Canadian wheat production is projected to edge down 1.1% year over year to 35.5 MMT in 2025, largely attributable to lower anticipated yields, which are expected to fall by 1.2% to 49.6 bu/acre. Harvested area is expected to remain steady, rising by 0.1% to 26.3 million acres.

The decrease in expected total wheat production is largely attributable to spring wheat, which is anticipated to fall by 2.0% to 26.0 MMT. The decrease is a result of lower projected harvested area, which is expected to fall by 1.5% to 18.4 million acres, and lower yields, which are anticipated to fall by 0.5% to 51.9 bu/acre.

Durum wheat yields are expected to fall 5.1% to 35.1 bu/acre, offsetting higher harvested area (+0.4% to 6.4 million acres), contributing to a 4.7% decrease in durum wheat production to 6.1 MMT.

Canola

Nationally, canola production is expected to increase by 3.6% to 19.9 MMT in 2025. The anticipated increase in production was attributable to higher yields, which are expected to rise by 5.7% to 41.0 bu/acre, offsetting lower harvested area, which is projected to decrease by 2.0% to 21.4 million acres.

Soybeans

Nationally, soybean production is projected to decrease by 7.3% year over year to 7.0 MMT in 2025 on lower yields. Harvested area is anticipated to increase 1.3% to 5.7 million acres.

In Manitoba, soybean production is projected to decrease by 5.3% to 1.6 MMT in 2025. Harvested area is expected to increase by 15.6% to 1.6 million acres, though yields are anticipated to fall by 18.0% year over year to 36.1 bu/acre this year.

Barley/Oats

Canadian farmers expect to produce 1.9% less barley year over year to 8.0 MMT in 2025, driven by lower harvested area, down 6.7% to 5.5 million acres. Yields are projected to increase by 5.2% to 66.5 bu/acre. Alberta is expected to produce more barley, rising by 3.6% to 4.4 MMT because of higher yields. In Saskatchewan, production is anticipated to decrease by 7.8% to 2.8 MMT because of lower yields.

Oat production is anticipated to rise by 1.0% to 3.4 MMT, a result of higher yields (+2.3% to 90.7 bu/acre), offsetting lower harvested area (-1.2% to 2.4 million acres) in 2025.

– Asia’s pledge to boost US farm imports may redraw trade flows… Southeast Asian nations are set to reshape global grains and oilseed trade flows through US trade deals that include raising agriculture purchases, with increased American shipments displacing Australian, Canadian and Russian supply. While Indonesia and Bangladesh have already agreed to increased buying as part of agreements that set lowered tariffs on their exports to the US, regional grains traders say Vietnam, the Philippines and Thailand may boost feed grain purchases under their deals.

“US farm exports are clearly set to gain ground in Asia,” said Ole Houe, director of advisory services at IKON Commodities in Sydney. “On one hand, trade deals are creating pressure, but just as important are the lower prices of US wheat, corn and soymeal, which are cheaper than supplies from rival exporters.”

An influx of US crops could push down prices for rivals and drive up costs for them to ship grains at greater distances, traders and analysts said. Over the past decade, suppliers from the Black Sea and South America have gained ground in Asia, eating into US market share.

– China buying Australian canola… China has booked at least three shipments of Australian canola, potentially ending a years-long freeze, reports Bloomberg. The cargoes were booked by Cofco International Ltd. for the fourth quarter, likely arriving at Chinese crushing plants after December. Australia has been shut out of China’s market since 2020 due to phytosanitary concerns, but China is now seeking to diversify its sources following a trade fallout with major supplier Canada, which was the top supplier of canola to China last year. However, relations between the two countries soured after Canada slapped levies on Chinese-made electric vehicles, steel and aluminum. China retaliated with tariffs on Canadian canola supplies. Australia is the world’s second-biggest exporter of canola.

– ASA weighs-in on China trade implications… US soybean growers are anxious for China to end its unofficial embargo, which has pressured US soybean prices. This as a Chinese negotiator arrives in the US for more tariff talks. American Soybean Association President Caleb Ragland told ABC News US producers cannot survive.

“25% of our soybeans that we raise go to China, and the other 25% are exported to other countries. So, trade is vital to our future, and we must have consistent, robust trade to be profitable on our farms,” Ragland remarked.

China has hit US beans with a tariff reported as high as 23% and replaced them with those from Brazil, pushing US prices downward. Amid its pressure campaign and a nearing US harvest, farmers hope for a resolution, but are want for reasons to be optimistic a solution will come soon.

Increased US-China trade tensions are negatively impacting soybean prices. China hasn’t purchased any US soybeans for the new crop marketing year. Cash basis levels have become much more negative in North Dakota…a negative price impact that is spilling into Manitoba. Normally, this time of the year North Dakota farmers see a minus 70 to minus 90 cents/bu basis during the harvest window. Today, the range is from a minus $1.35 to a minus $1.60.

– Aussie crop prospects rising... Australia is on track to produce between 32 and 35 MMT of wheat in its upcoming harvest, according to analysts, who raised their forecasts after an improvement in crop conditions and said they could further upgrade them. That level of production would be similar to last season’s 34.1 MMT and well above the 10-year average of 27.6 MMT, adding to global wheat supply at a time when wheat prices are in the tank. The government’s ABARES agency is due to publish its latest harvest projections on September 2.

Widespread rain during July and August boosted soil moisture, though crops in the south and southeast, which were dry earlier in the season, remain behind schedule. September is critical to Aussie crop production.

Analysts forecast a barley crop between 13.1 and 16 MMT, compared with year ago 13.3 MMT and a 10-year average of 11 MMT.

They predicted a canola harvest between 5.8 and 7.2 MMT, compared with last year’s 6.1 MMT and a 10-year average of 4.8 MMT.

– Russia-Ukraine war still running hot... Russia unleashed a wave of drone and missile strikes on Kyiv Thursday, killing 14 people, including three children, and injuring at least 48. Ukrainian air defense said Russia fired nearly 600 drones and 31 missiles in strikes across the country overnight, with 563 drones and 26 of the missiles shot down. Meantime, Ukraine said it hit two Russian oil refineries. Ukraine has intensified attacks on Russia’s energy industry over the past month, targeting multiple refineries and export infrastructure, creating a crisis in Russia’s domestic fuel market. The attacks came almost two weeks after President Trump abandoned US demands for Russia to agree to a ceasefire to allow for peace talks at his summit with Russian President Putin in Alaska.

– Ukraine 2025 wheat crop seen at 21.8 MMT… Ukraine’s 2025 wheat harvest is forecast at a maximum of 21.8 MMT, down from 22.7 MMT in 2024, the UAC farmers’ union said. Ukraine is a major global supplier of grains, including wheat and corn, and exports about 40 MMT in total per season. UAC also noted that low demand had caused milling wheat prices to fall by several dollars over the past week to approximately US $228-$230/ton per ton carriage paid to (CPT). There is competition with Russia into North African markets.

The union slightly increased its outlook for Ukraine’s 2025 corn output to 29 MMT from 28 MMT previously. The main competition will come from US corn competing into the European market.

– Combined US/Canada cattle, hog herds mixed... Combined US and Canadian cattle and hog inventory numbers were mixed when compared to a year ago. The USDA and Statistics Canada say that combined hog herd was slightly larger than this time last year at 89 million head, with a modest increase for the US to 75.1 million head canceling out a 1% decrease in Canada at 13.8 million head.

The combined cattle inventory was 1% lower at 106 million head, as a 1% dip in the US to 94.2 million canceled out a 1% rise for Canada at 4.44 million head.

Outside Markets

The Dow Jones Industrial Average gained 147.16 points on Wednesday to settle at 45,565.23, while the S&P 500 was up 15.46 points to 6,481.40. Early Thursday, the September Dow Jones Futures are up 72 points.

US stock index futures are higher this morning. European stock markets are mixed to slightly higher, while Asian markets were higher overnight.

Global stock markets are recovering after a tech stock wobble yesterday after chip giant Nvidia’s results fell short of some analyst expectations. Investor concerns centered on Nvidia’s China business, which has been caught up in the trade war between Washington and Beijing. While the company’s results were “gigantic” numbers, Swissquote Bank senior analyst Ipek Ozkardeskaya noted that “they weren’t as gigantic as the most bullish estimates.”

The September US Dollar Index is down 0.207 at 97.920. The Canadian dollar strengthened against its US counterpart…currently quoted at 72,71 US cents.

October crude oil futures are down $0.08 at US $64.07/barrel. Oil slipped on expectations of lower US fuel demand with the end of the summer travel season. Prices were also pressured by the restart of Russian supply to Hungary and Slovakia through the Druzhba pipeline, following an outage caused by a Ukrainian attack in Russia last week.

Grain Markets

Chicago soybean futures are steady to a penny weaker this morning. Bean futures posted losses of 1 to 2 cents across most front months on Wednesday. Soymeal futures are narrowly mixed this morning after losing $3 to $6 on Wednesday. Soyoil futures are tipping a very modest 2 to 9 points lower right now…but continuing a sell down tone of late.

USDA this morning reported old crop US soybean export sales cancelations of 189,200 tonnes for the week ended Aug 21…within trade expectations. Note the US soybean marketing year ends Aug 31, with sales likely transferred to new crop after Sept 1. New crop US bean sales for this same week came in at 1.373 MMT, which beat even the highest of trade expectations which ranged between 0.45 and 1 MMT.

Soybean market attention is shifting focus to probable US-China talks. Senior Chinese trade negotiator Li Chenggang is in Washington this week to meet US officials, with the two superpowers looking to chart a path beyond their current tariff truce. But it’s unknown how much can be done in this informal round of talks and how much of a concentration there is on ag.

Farmers in various parts of North Dakota that rely on feeding the PNW with soybeans for export to Asia are reporting that because China has purchased zero US new crop soybeans (at least not outright), local cash basis has weakened considerably under the futures market, and it changes almost daily.

Meanwhile, US soy crop weather looks generally non-threatening, though parts of the region could use some rain. Recent private estimates have been mixed, but most have been very close to, if not slightly above, the USDA’s most recent projection.

Chicago corn futures fractionally to a penny lower this morning. The corn market fell into Wednesday’s close, with pressure from losses in wheat. Contracts were down 3 to 5 cents.

USDA this morning reported old crop US corn export sales cancelations of 17,600 tonnes for the week ended Aug 21…within trade expectations. Note the US corn marketing year ends Aug 31, with sales likely transferred to new crop after Sept 1. New crop US corn sales for this same week came in at 2.090 MMT, which came within trade expectations ranging between 1.2 to 2.6 MMT.

EIA’s weekly report showed US ethanol production slipping 2,000 barrels per day in the week that ended on August 22 at 1.07 million barrels per day. Ethanol stocks were down 139,000 barrels to 22.549 million barrels.

US farmers who are finding corn rust in their fields report heavy cases of it. Those farmers are being told that the estimates of yield cuts could range from 20%-40%. However, the market remains cautious about the pre-harvest commentary. Portions of the US Corn Belt could use some finishing rain, but the trade continues to expect a record large crop this year.

While demand for US corn is solid, the impending record harvest will likely continue to limit the price upside.

US wheat markets are weaker again this morning…winter wheat futures are down 3 cents, while Minnie spring wheat is off 1 to 2 cents. Wheat is continuing down the path of least resistance, as losses are being shown across all three US exchanges. Spring wheat futures collapsed late in Wednesday’s trade, down 13 to 15 cents on the session to fresh contract lows.

There’s more near-term rain in the forecast for the southern US Plains ahead of winter wheat planting. That’s expected to spread further east over the next few days. Minneapolis spring wheat futures are into fresh contract lows on US/Canada spring wheat harvest pressure. Global prices are trending lower on the rising supply, which is also cutting into export demand.

USDA this morning reported US wheat export sales of 579,800 tonnes for the week ended Aug 21…within trade expectations ranging between 400,000 to 700,000 tonnes.

Russia’s ongoing attacks on Ukraine keep uncertainty in the global wheat market. With a deadly attack on Wednesday night, a peace agreement appears far off.

CANADIAN GRAIN MARKET

ICE canola futures closed lower for the third straight day on Wednesday, ahead of the season’s first set of production estimates from Statistics Canada.

Chicago soybean and soyoil futures were lower yesterday, but European rapeseed and palm oil moved higher.

November fell $4.10 on Wednesday to close at $650.70/tonne, and January was down $3.80 at $663.10.

For today… canola futures are trading down another $4 to $6/tonne this morning, losing ground for a 4th consecutive session. Nov canola futures are $4.60 lower right now at $646.10/tonne, marking a distressing break below its 200-day moving average ($649)…and trading below all its key moving averages without a bottom yet in sight…which likely spurs spec fund selling in the futures.

StatCan this morning released its model-based production estimates based on end of July conditions…19.9 MMT…higher than last year (19.2 MMT) but slightly below the average trade guess (20.3 MMT) and last week’s Ag Canada’s upwardly revised August estimate (20.1 MMT). Initial trade thoughts are further upside is possible in the StatCan estimate, given the modelling is based on conditions up until the end of July, before more plentiful rain improved conditions in many areas in August.

Canola is entering harvest season, so typical harvest pressure can be expected…weak cash basis for near-term cash delivery positions and futures are trading at full carry.

Traders remains concerned about China’s tariff on Canadian canola…threatening 2025-26 trade with our largest canola seed market.

This morning…Chicago soyoil is continuing to trend lower, drawing canola lower the past four trading sessions. Soybeans are flat to weakish…and at the top of long sideways pattern. EU rapeseed futures are weaker and seemingly going nowhere, while Malaysian palm oil futures continue to grind down from the contract highs set earlier in the month.

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