Deteriorating US crop conditions bolster grain markets
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Weekly US corn, soybean ratings sink below market expectations
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Chicago prices buoyed, although currency moves weigh on EU grains
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Brent crude slides again, undermining rapeseed and soyoil prices
Grain prices rose in Chicago, supported by growing concerns for weather damage to crop prospects, although currency moves curbed the spread of support to European markets.
The USDA overnight reported that the proportion of US soybeans rated “good” or “excellent” had declined by 3 points week on week to 63%, 1 point below market expectations, and narrowing to 1.5 points the advantage over the five-year average.
For corn, the crop reading sank by 4 points week on week to 63% good or excellent - a figure shy of the 65% rating that traders had expected, and below the five-year average of 64%.
The deterioration came in a week of unduly dry weather, for much of the Plains and western Corn Belt, where hot weather has threatened crops in many areas too, amid the heat-sensitive corn pollination and soybean pod-setting periods.
The USDA said that in the western Corn Belt, “crop conditions have worsened amid a hot, dry regime”, adding that in the northern Plains “diminishing soil moisture reserves are boosting irrigation demands and stressing rangeland, pastures, and rain-fed summer crops”.
The outlook for the Plains remains hot and largely dry into mid-August, although there is a chance for scattered rains in the core Corn Belt states this week, with precipitation chances growing next week.
The crop ratings, and weather outlooks, stoked doubts that the US corn yield will reach the 11.49t/ha that the USDA forecasts, the second largest on record, and the US soybean yield the all-time high of 3.57t/ha expected.
Best-traded December-26 corn futures added 1.6% in late morning deals in Chicago, where soybeans for November-26 rose by 0.6%, defying a further decline in soyoil prices on a weaker crude oil market.
Nonetheless, European markets, while paring losses in late deals, remained in negative territory, weighed by firmness in the euro and sterling, which curbs the competitiveness of EU and UK exports,
Paris milling wheat for September-26 traded 0.7% down in late deals, while London feed wheat for November-26 eased 0.3%.
Even so, prices remain amongst their highest of the last 18 months, maintaining some support from continued disruptions to Ukrainian and Russian shipments of exports including grains.
Ukraine over the weekend reportedly launched a sizeable attach on the Russian port of Rostov, and struck a vessel in Russia’s land-locked Caspian Sea. Russia has reportedly struck another vessel near Odesa. SovEcon cut by 1.9Mt to 44.6Mt its forecast for Russia’s wheat exports in 2026/27, citing the Azov Sea shipping restrictions forced by Ukrainian attacks.
Russian was said by Bloomberg to be proposing to arm grain ships with machine guns and mobile missile launchers, to counter Ukrainian drone attacks.
Also in Paris, corn futures for November-26 shed 1.1%, weighed by data showing a 42% increase in EU imports so far in 2026/27, to 1.0Mt, to counter the prospect of a supply void left by a heat-reduced domestic harvest.
The contract is on course for a fourth successive losing session, for the first time since April.
Rapeseed futures for November-26 dipped by 0.8%, to take nearly to 6% their decline in three sessions.
The oilseed has, like soyoil, been weighed by the dent to crude oil prices from increasing hopes of a pause in Iran-US attacks leading to a longer-lasting pause in hostilities, boosting chances for trade through the Strait of Hormuz.
Brent crude dipped by 6.3% to $82.80/Bbl, after US President Donald Trump reported “good talks” with Iran.
Oman has presented Iran with a plan backed by Gulf states to manage the Strait of Hormuz, including collecting voluntary fees for using it, according to Reuters.
