Grain Market Commentary 10/17/25
CBOT Pricing:
Soybeans settled 6-8 cents higher after the Trump Administration said multiple positive things about the US-China relationship. The Nov26 contract traded its highest level in over a week and closed 8.75 higher at $10.195. The Jan26 contract closed 8.25 cents up at $10.675. Soybean calendar spreads traded both sides but ultimately finished firmer with Nov-Jan settling at -17.25 cents.
Corn was up 6-12 cents, following the soybean rally. The Dec25 contract finished 6 cents higher, the 4th straight higher close, at $4.225. The Mar26 closed 10 cents higher at $4.365. The Dec-Mar spread closed nearly unchanged at -14 cents.
Corn and soy products were up more than 2% while soybeans and wheat were up 1-2% on the week.
Market Headlines:
POTUS Trump said he will be meeting with China in a few weeks:
Trump stated that the high tariff rate he has threatened would not be “sustainable” and that the US has to have a fair deal with China. White House Economic Advisor Hasset also spoke on the upcoming meeting, saying that the US is not at war with China and that the two countries can get back to a “good place”. He did admit that China has leverage on rare earths.
Costly Brazilian soybeans may cause China to dip into its reserves:
China still needs roughly 8-9 MT of soybeans for December-January delivery. The county would normally purchase US soybeans during this time, but because of ongoing trade tensions, with the US, China has been relying on Brazil. However, Brazilian soybeans cost $2.80-$2.90 over soybean futures, compared to US soybeans that cost about $1.70 over futures. These elevated costs have limited Chinese soybean processor’s profits. In result, China may need to dip into their reserves to meet demand. The country can certainly afford this as the 2024/25 ending stocks were the highest on record.
The CME group is planning to launch finical contracts that are linked to sports games and economic indicators:
The contracts are expected to be available by the end of the year and allow the CME to compete with other prediction market platforms like Kalshi and Polymarket. The CME can self-certify the contracts under its CFTC license, which could speed up their rollout, but the contracts still face regulatory hurdles.
USDA Weekly Drought Monitor:
Areas of Ohio, Indiana, and Kentucky received heavy rainfall which improved drought conditions. However, limited rainfall was experienced by parts to Wisconsin, Minnesota, Iowa, Illinois, and Missouri which led conditions to worsen. In the Corn Belt, about 38% of the region is experiencing some form of drought conditions. This is notable improvement from last year, when about 53% of the Corn Belt was affected by drought conditions.
US areas experiencing drought:
Corn: 31%
Soybeans: 39%
Winter Wheat: 45%
Spring Wheat: 16%
Cattle: 24%
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