AM Comments June 25 2025
Good morning. Mid-week trade on Wednesday has started much the same as the previous sessions this week, with the ag space trading marginally lower across the board. Corn futures have again made new contract lows in both crop years, while meal has also made new contract lows this morning. As for the rest of the soy complex, oil looks to continue seeing influence from action in crude, while the beans themselves are working on a fourth straight session of lower closes. Otherwise, it would appear to be more of the same today as its been all week, with Middle East headlines the most prominent market feature and traders in the ag world just trying to get Monday's acreage data. Corn futures to start Wednesday are trading 3-4 cents lower, soybean futures are trading 5-6 cents lower, and the Chicago wheat market is trading 2-3 cents lower. Products are lower, soybean meal is down around $1/ton, and soybean oil is down 20-30 points. Outside markets are mixed, with crude oil futures up 20-40 cents/bbl, the Dow Jones index is up 10 points, and the US$ index up 30 points; the S&P500 is near unchanged and the NASDAQ is up 70 points.
Today's Reports: EIA Weekly Ethanol Production/Energy Stocks
- This morning's weekly ethanol report from the EIA for the week ending June 20th is expected to show average daily production in the week between 1.100-1.151 mil bbls, while stocks in the week are seen between 23.60-25.00 mil bbls. If accurate, the upper end of the range of production estimates would be a new record.
- Brazilian consultancy Agroconsult said on Tuesday following field surveys that they see the country's safrinha corn crop this year totaling 123.3 MMT's, which is more than 10 MMTs higher than their estimate given in May and more than 20 MMTs higher than last year's crop. Of note, CONAB currently has safrinha production pegged at just over 100 MMTs.
- Analyst estimates are beginning to trickle out for Monday's reports; a group of Bloomberg analysts sees the acreage figures as almost entirely unchanged from March, with their avg guess on corn at 95.4 million, soybeans at 83.5 million, and wheat at 45.4 million. The corn figure would be up just 100k acres, while the other two would be unchanged.
- On the stocks side, the group sees US corn stocks as of June 1 at 4.625 bil bu, which would be down about 7% from last year; soybean stocks are seen at 974 mil bu, up just fractionally from last year, and wheat stocks are seen at 836 mil bu, up 20% from last year.
- The USDA's quarterly hogs and pigs report is scheduled to be released tomorrow afternoon; the report is expected to show US hog inventory as of June 1 at 74.77 mil head, which would be down just 0.2% from last year. Breeding inventory is seen down 0.1% from last year at 6.004 mil head, while the amount of market hogs is seen down 0.2% at 68.769 mil head.
- According to traders familiar with the matter, Russian exporters plan to boost grain and veg oil exports to Iran in the months ahead, as both parties remain heavily sanctioned by the west. In 2024/25, Iran was the second largest total buyer of Russian grains, trialing only Egypt, while traders see the potential for wheat exports to triple from current levels while barely exports could be up around a million tons.
- After seemingly being on shaky ground to start the week, it appears the ceasefire between Israel and Iran is holding into day three, though both sides have claimed victory and there seems to be little easing of tensions otherwise. Other news on the situation this morning includes a Pentagon report that the bombs dropped had only a limited impact on Iran's nuclear program, which President Trump has vehemently rejected.
- Fed Chair Powell will give a second day of Congressional testimony today on Wednesday, after largely using the same rhetoric on day one yesterday as he has for most of Trump's second term. Chatter regarding interest rate cuts again picked back up the last couple days following the dive in crude oil prices, but the CME's FedWatch tool for both the July meeting and the September shows odds that are mostly unchanged from earlier in the week.
- High pressure ridging that brought heat to the eastern US over the past several days is expected to work its way east across the Atlantic into next week, likely providing crop areas in Europe with the same warm/dry conditions seen here recently. While the situation should aid winter wheat harvest, it will likely add to crop stress that has already been on the rise in southern areas due to a recent lack of rain.
- Storms have begun working through the Plains and western Midwest, with 24-hour satellite data showing rainfall of a few tenths to 1.5" generally speaking stretching from NM to NE/IA. Additional rains are expected through the day today, with the EU forecast showing similar totals of 0.1" to 1.5" through the day today, with the heaviest totals expected in MN/WI.
- Otherwise, storms are still expected to return to the southeastern US into next week, as ridging breaks down. Week two model output continues to show improved rainfall chances along the Gulf Coast and other areas in the southeast, while offering a mixed bag for most of the Corn Belt. While not as extreme as the past few days, temperatures across the eastern US look to remain elevated through the middle of next week, while the central US sees temps that are seasonally below average.