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Happy Monday,
Big week — the complex rallied hard on three simultaneous drivers. Iran attacked three vessels in the Strait, breaking the ceasefire (though Trump signaled it wouldn’t escalate to the previous months’ fighting). China stepped in on soybean and meal buying. And the July WASDE landed bullish for corn and wheat. Everything on the ag side finished green.
How the Week Closed
| Commodity |
Weekly Change |
| Corn (December) |
+19.5¢/bu |
| Soybeans (November) |
+43¢/bu |
| Canola (November) |
+$38/MT |
| Spring Wheat (December) |
+34.25¢/bu |
| HRW (KC) Wheat (Sept) |
+37.75¢/bu |
| SRW Wheat (Sept) |
+40.5¢/bu |
| Crude Oil (WTI) |
+$3/bbl (~$76 peak) |
| Heating Oil (ULSD) |
+36¢/gal |
Full green screen — the whole complex bid on Iran + China + WASDE combining into one week.
Note: Price changes are Friday-over-Thursday (last Friday was closed for July 4). Spring wheat rolled to December contract.
July WASDE Recap
The line through: tightening US corn and wheat balance sheets, modestly larger soybean crop, and firmer global grain markets as adverse foreign weather trims supply.
U.S. Numbers
| • | Corn: Production nudged to 16.0B bushels (yield unchanged at 183). Beginning stocks cut 125M on higher old-crop feed use. Exports +50M on strong global demand. Ending stocks down 170M to 1.79B — below 2B. Bullish tightening. |
| • | Soybeans: Production +40M to 4.475B on higher harvested area (84.4M ac, yield unchanged at 53). Higher exports (+30M) offset supply. Ending stocks flat at 310M. Crush unchanged at 2.75B. |
| • | Wheat: Production -7M to 1.536B — lowest since the 1970-71 crop. Winter -39M to 990M, spring 475M, durum 71M. Ending stocks -22M to 722M — a 22% year-over-year reduction. |
Global Numbers
| • | World wheat ending stocks: Down 2.6M tons to 272.8M — cuts to US, India, Argentina, and Canada. Russia and Ukraine production raised. |
| • | World corn stocks: Down 6M tons to 275.3M. EU corn hit hard by record heat led by France — potentially the lowest output in 30 years. |
| • | World soybean ending stocks: Down 0.7M tons to 124.2M — mainly lower Brazil. |
| • | Global oil seed production: Up 1.8M tons to 720M. |
Canadian Numbers (StatsCan)
| • | All wheat production: Lowered to 34M tons (from 35M). Exports cut to 27.5M, ending stocks down to 4.21M. |
| • | Canola: Nothing reported in the WASDE. Watching StatsCan updates closely as Alberta conditions deteriorate. |
USDA didn’t change yields yet, so the July report is really a stocks/demand story. July weather will decide whether yields come down from here — and with corn ending stocks already sub-2B, there’s not much cushion.
What Drove Markets This Week
Iran flared back up. Three vessels attacked in the Strait, US responded. Energy caught a bid — WTI ran to about $76/bbl before pulling back after Trump signaled it wouldn’t escalate to the intense clashes from earlier this year. Bean oil rallied with energy, dragging the oil seeds higher.
China came in on soybeans and soy meal. Current and new-crop bean purchases plus big meal buying gave the complex a demand-side reason to bid alongside the war-premium factor. Beans finished +43¢.
WASDE landed bullish for corn and wheat (details above). Sub-2B corn ending stocks and the lowest wheat production since 1970-71 gave the market plenty to work with going into the July weather window.
Fund Positioning (CFTC as of July 7)
Bullish shifts across almost the whole complex — corn short more than cut in half, meal length quadrupled, soybeans nearly doubled long:
| Commodity |
This Week |
Last Week |
W/W Change |
| Corn |
-15K |
-67K |
+52K |
| Soybeans |
+69.5K |
+38K |
+31.5K |
| Bean Oil |
+85K |
+92K |
-7K |
| Meal |
+18.7K |
+4.7K |
+14K |
| SRW Wheat |
-60K |
-67K |
+7K |
| HRW Wheat |
+8.7K |
+5K |
+3.7K |
| HRS Wheat |
-7.5K |
-7K |
-0.5K |
| Canola |
+12K |
+10K |
+1.7K |
Positions in thousands of contracts, net managed money. Positive change = bullish shift (added length or covered shorts). Cutoff Tuesday, July 7 — before Friday’s WASDE.
Bean oil was the outlier on the reduction side; HRS held basically pat. Everything else moved bullish through the week even before the report hit.
Export & Demand Update
U.S. Inspections & Sales
| • | Corn: Inspections 1.641M MT (vs. 1.8M) — solid. Sales just under 700K gross, netted to 566K. New crop 402K. Total commitments 1.5M MT above USDA’s pre-WASDE projection. |
| • | Soybeans: Inspections 528K MT (vs. 443K). Sales 132K, netted to 54K. New crop: 480K — another big print, China stepping in. |
| • | Soybean meal: 352K gross, netted to 225K. New crop 96K. Big China commitments here too. |
| • | Wheat: Inspections down to 133K MT (vs. ~400K). Sales 336K, netted to 313K. |
| • | Ethanol production: 1.093M barrels/day (vs. 1.117M). Margins still solid despite the pullback. |
Canadian Exports & Domestic Use
| • | Canola exports: Just 53K MT — looks like one boat. Very weak. Domestic disappearance 246K MT. |
| • | Wheat exports: 527K MT. Domestic use 163K MT — big. |
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Processor Margins Building Back
Canola board (Nov): $352/MT — gains came out of bean oil and meal strength even as CAD firmed slightly. Soybean crush (Aug): $2.88/bu — picked up from $2.70 last week. Ethanol margins: high 60¢/gal, compressed slightly as corn rallied.
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U.S. Crop Conditions
| • | Winter wheat harvest: 59% (vs. 5-yr avg 51%, last year 51%) — well ahead. |
| • | Spring wheat headed: 54% (in line with 5-yr avg, below last year 58%). Conditions 57% G/E, down 2 points W/W — 2% moved from good to fair. |
| • | Corn: 16% silking (vs. 14% 5-yr avg, last year 17%). Conditions 67% G/E (unchanged) vs. 74% last year. No category shifts. |
| • | Soybeans: 34% blooming (vs. 38% 5-yr, ahead of last year 30%). 9% pod-setting (vs. 6% avg). Conditions 64% G/E, down 1 point W/W. |
Corn is entering the critical silking window with conditions holding. The heat dome hitting the northern Midwest states without recent big rains is the risk — most of the Midwest is at least getting overnight cooling for crop relief.
Canadian Crops: Alberta Deterioration Continues
| • | Saskatchewan: No conditions report this week. But topsoil moisture jumped — from 77% adequate / 19% surplus two weeks ago to 30% surplus / 69% adequate now. The surplus number climbing is a flag for water-logging risk. |
| • | Alberta: Spring wheat 68.4% G/E (down 2 points W/W). Canola 56% G/E (down 1). All major crops 64.2% G/E vs. 65.9% last week — deterioration continuing. |
Alberta is where the heat and dryness are biting hardest. Sask has the opposite problem developing — too much moisture.
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Heat Dome Building Over Western Canada
Mid-to-high 30°C temperatures forecast, with humidex reaching into the 40s in some areas. The bigger concern is overnight lows — well above 16°C, some in the low-to-mid 20s. Plants get no relief at night, which stresses crops much harder than daytime heat alone. Also hitting the northern Midwest states.
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Canola Watch: Australia Enters the Picture
Canola +$38/MT on the week — got the biofuels/oilseed bid alongside the war-premium rally. But the more interesting development is Australia running about 35% below average moisture for this time of year. Official government reports still have Australian production at a solid 6.2M tonnes, but there’s plenty of time for yield hits to shift that number lower.
Aussie problems are Canadian opportunity. Australia has been the swing exporter to the EU (nearly 6M tons of demand). Every tonne shaved off their crop pushes buyers toward Canada — supportive for both basis and ICE futures. Layer that on top of Alberta deterioration and the acreage-vs-yield tug of war continues, but the yield side is gaining ground.
What to Watch Ahead
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July Weather & Corn Silking Window
Corn is entering pollination. With ending stocks sub-2B and USDA holding yield at 183, there’s no cushion for a heat-driven yield hit. Watch the northern Midwest heat dome closely.
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Western Canada Heat Dome
Overnight lows >16°C stress plants harder than daytime heat. Alberta conditions already deteriorating — if the heat dome persists, expect more meaningful cuts to trendline yields in the next round of reports.
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Australia Canola Situation
35% below average moisture. Official numbers still solid, but there’s plenty of time for that to change. Every tonne off the Aussie crop is a tailwind for Canadian basis and ICE futures.
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Iran & Energy Rhetoric
Trump signaled restraint, but the ceasefire is broken. Any escalation feeds straight back into energy and oil seeds. Watch for follow-on incidents or de-escalation news.
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Bottom line: Three-driver rally — Iran, China, WASDE all bullish in the same week. Corn stocks sub-2B, wheat production at a 55-year low, and canola’s yield-side story building on Alberta and Australia weather. July weather is now the decider. Preserve profit and protect when you can. No one ever went broke making money.
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Have a great week and reach out with any questions.
Stephen
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