Evening Comments (RJ O'Brien)

Evening Grain Comments - July 8th, 2025

 Corn

Corn kicked off the new week lower overnight, remaining through the day and closing lower – Sept corn settling 16¾ lower at $4.03½, Dec 16¼ lower at $4.20¾. Weaker prices driven by favorable weather forecasts through mid/third week July, while disappointment that rumored deal with China and potentially others appear to be rumor only for now since Thurs Trump speech in Iowa had no mention of a deal outside of what had already been hammered out with China in Geneva. With the July 9 trade deal deadline looming, Pres Trump announced delaying to Aug. 1 with details on tariff levels if deals are not struck - 25% on Japan and South Korean imports, 30% South African products, 25% Malaysian goods.  Rates over all were the same or slightly lower than originally pushed out in April. USDA export sales flash of 135K MT to Mexico, 29K old crop and 106K MT new crop announced this morning. Export inspections were mid-range of trade expectations (43-64 mbu) at 58.7 mbu – well over the 47.5 mbu/wk avg needed to reach USDA projections. Mexico and Japan were the two leading destinations. Milo inspections light, just 350K bu – all to Mexico (Southern Tx new crop.) South Texas harvest activity is expanding further north and East of the Rio Grande Valley area (call them 50% harvested) and Corpus tributary areas (call then 20% harvested) – seeing some early milo harvest in Houston/ Galveston tributary area/ corn harvest just starting. Milo yields running in the low 90’s to 125 bpa, higher side of average yields historically but some producers disappointed vs their expectations. Rio Grande Valley area has had some periodic precip events that has delayed harvest and caused some sprout damage. Corn harvest started in spots, crop should be drier and more harvest friendly end of this week – hard to lean on combine monitors but early harvest showing 200 + bpa yields, expectations are for near/ new record yields. Unconfirmed report of a first load of new crop corn dumped in La, majority of harvest 2 to 3 weeks away per boots on the ground report…getting closer. Cash trade was quiet, Western UP Grp 3 values 1 to 2 cents firmer Jul/Aug but overall steady, processor posted values generally steady as well.

 Beans

Big sell-off day in futures/equities as last week Wednesday’s rumors (rumored trade negotiations with China) did not materialize and so the bounce of nearly $.30 Thur/Friday, turned to sell-the-fact today with SX closing down $.28^4 @ $10.20^6. Additionally, President Trump’s sharp comments to those who choose to partner with the BRIC countries being subject to additional 10% tariffs. And last, Trump placed 25% tariff on Japan and S. Ko starting Aug 1^st to get them to negotiation table. Soybean inspections were 14.2 mbu (6-15 expected) and 16.7 needed per week BOY. 9.6 mbu out of gulf, 4.6 interior. Processor basis firming as board break stalls farmer movement and most in merchants waiting for processors to grind through the spill over coverage caused by ADM pulling out. ADM is back in and trying to get July coverage happening taking processors over river parity. 

 Wheat

Wheat futures were off 8-10 cents across all classes due to harvest progress, a sell-off in corn and beans, and a favorable global wheat outlook. Russia removed the wheat export duty in an effort to increase export pace, with June shipments around 25% of LY’s volumes. Argentina's wheat crop is 78% planted, up from 45% last week. US winter wheat conditions were unchanged as expected at 48% G/E. Winter wheat harvest jumped to 53% from 37% last week, which was right at the trade average guess, slightly below LY’s 62% but in line with the 54% 5-year average. KS harvest progress experienced the most significant jump at 29%, trailing LY’s 90% but surpassing the 5-year average of 77%. NE conditions standout with a 29% bump in G/E. At 78% of the crop still to harvest, this looks like bad data but its what was printed. Spring wheat conditions dropped 3% to 50%, well below LY’s 75% G/E. 61% of the spring wheat crop is headed vs 56% LY and 58% average. Wheat inspections of 16 mbu were toward the higher end of the 11-18 estimates. Another big week of HRW at 7.6 mbu, followed by SRW 3.6, HRS 2.9, and WW 1.3. Indonesia Wheat Flour Mills Association signed a memorandum of understanding to buy at least 1 MMT of US wheat per year from 2026 to 2030 in efforts to smooth tariff negotiations, including 800K MT of wheat through the remainder of 2025. Funds sold and estimated 4500 contacts of wheat today.