Market Report 01.09.2026

Black Sea risks and US weather keep grain markets supported as soybean oil drives the oilseed complex

General market overview

🚢 Black Sea risk remains a key driver for grain markets after new large-scale attacks on Kyiv and repeated strikes on already damaged grain terminals in Odesa. The queue of vessels waiting to enter Ukrainian ports through the Danube has increased to 80, while Ukraine’s August grain exports are expected to fall to less than half of normal levels.
🚢🇷🇺 The region’s logistics structure continues to shift. Russia is increasing shipments through Baltic Sea ports, while Black Sea routes remain under pressure from attacks and disruptions.
📑 Markets remain fundamentally supported, but after the sharp rally they are becoming increasingly sensitive to overbought conditions and profit-taking risk.

🌦️ Weather

🌦️🇺🇸 The final stage of the US growing season remains hot and dry. Over the next week, rainfall will be largely limited to southern Minnesota, Wisconsin and Michigan, while most production areas stay warm and dry. The 8–14 day outlook points to more normal rainfall and less extreme heat across the Midwest, but moisture is rapidly disappearing in the southern Plains due to abnormal heat and no meaningful rainfall expected for at least a week.
🌧️🇮🇳 Rainfall remains weak in India. August precipitation was 16% below normal, while September is also expected to be drier than normal.
🌦️🇧🇷 Weather will quickly become more important in Brazil as soybean planting could begin as early as next week in Mato Grosso. Planting windows in Paraná, Rio Grande do Sul and Goiás will gradually open over the following three weeks.

🫛 Soybean complex

📈 Soybeans are higher today and have posted another contract high, supported by a strong rally in soybean oil. The biofuel factor has become the main driver following the EPA decision, as full reallocation of exempted volumes for 2025–2027 supports expectations that overall biofuel volumes will remain high.
🛢️ Soybean oil opened with a gap higher on the biofuel quota news and a strong rise in crude oil. This sharply improved sentiment across the soybean complex despite a weaker old-crop export pace.
🫛🇺🇸 US soybean conditions deteriorated by 2 percentage points to 58% good/excellent, compared with 65% last year, while poor/very poor increased to 13%. The sharpest deterioration was seen in Kansas, Kentucky, Louisiana and Minnesota, keeping production risk elevated during the final stage of the season.
🌦️🇺🇸 A warm and dry week remains supportive for soybeans as the crop is still completing development and moisture will remain limited across most production areas. Less extreme heat and more normal rainfall in the 8–14 day forecast could partially limit further expansion of the weather premium.
📊🇺🇸 Dr. Cordonnier left his US soybean yield estimate unchanged at 51.5 bu/acre. This remains below USDA and reinforces doubts about official crop potential following the deterioration in condition ratings.
🌧️🇮🇳 India’s weak monsoon remains supportive for the oilseed complex as oilseed crops continue to face stress. This adds external support to vegetable oils alongside the US biofuel story.
🚜🇧🇷 Brazil’s soybean planting season is approaching, making weather in Mato Grosso and other key states an increasingly important market factor. With El Niño risks in focus, traders will closely monitor early planting conditions.
🏭 USDA expectations for July crush remain supportive. Processing is estimated at 220.1 million bushels, up 1.1% m/m and 7.3% y/y. Soybean oil stocks are expected at a seven-month low of 1.878 billion pounds, supporting the product side of the balance sheet.
🚢🇺🇸 US soybean export inspections for the week ended August 27 totaled 250.8 thousand t. Cumulative inspections are 18.2% below last year, but have already reached 98.5% of the USDA forecast, compared with the 96.4% five-year average.

Bottom line: Buyers remain in control of the soybean complex, supported by the strong biofuel driver, higher soybean oil, deteriorating US crop conditions, Dr. Cordonnier’s lower yield estimate, India’s weak monsoon and the approaching Brazilian planting season. The trend remains upward, although fresh contract highs increase the risk of profit-taking.

🌽 Corn

📉 December corn posted another contract high overnight but is trading slightly lower today, similar to several recent sessions. The rally from the August 11 low has already reached $0.86/bu, increasing the risk of a moderate correction as the market becomes overbought and harvest approaches.
🌽🇺🇸 US corn conditions remained unchanged at 57% good/excellent, compared with 69% last year, while poor/very poor stayed at 17%. This does not add a new bearish signal for production but confirms that crop quality remains substantially weaker than last year.
🌦️🇺🇸 A very hot and dry finish to the season continues to support corn, with major production areas expected to remain warm and mostly dry. This preserves risk around final crop development even though the market has already priced in a significant tightening of the balance sheet.
📊🇺🇸 Dr. Cordonnier lowered his US corn yield estimate by another 1 bu/acre to 178 bu/acre. This supports expectations for lower ending stocks and remains one of the key fundamental arguments for buyers.
🚜🇧🇷 Brazil’s safrinha harvest has reached 96%, while first-crop corn planting is 11% complete, compared with 7% last year. At the same time, rising domestic Brazilian corn prices at the end of the safrinha harvest are unusual and suggest that the global market is reassessing supply availability.
📑 The speculative corn long has become a potential risk. Managed Money positioning at the start of the week is estimated above 405,000 contracts, not far from the historical high of 454,000. Crowded positioning could trigger a short-term correction even if fundamentals remain bullish.
🚢🇺🇸 US corn export inspections for the week ended August 27 totaled 1.496 MMT. Cumulative inspections are 25.1% above last year and have already reached 99.2% of the USDA forecast, compared with the 88.2% five-year average.

Bottom line: Corn is correcting slightly after another contract high, but fundamental support remains strong. Hot and dry US weather, Dr. Cordonnier’s lower yield estimate, Black Sea disruptions, strong export inspections and expectations for lower ending stocks continue to support the market, while an oversized fund long raises the risk of short-term profit-taking.

🌾 Wheat

📈 Wheat jumped nearly $0.20/bu overnight and reached a new 3.5-year high after Russia rejected Turkey’s proposal for a grain export corridor. Most of the overnight gain has since been erased, pointing to profit-taking after the sharp rally.
🚜🇺🇸 US HRS harvest has reached 77%, above the 68% average. Faster harvest progress reduces production uncertainty for spring wheat but does not offset support from the southern Plains and Black Sea risks.
🌦️🇺🇸 Drought in the southern Plains is deteriorating rapidly as soil moisture disappears under abnormal heat and virtually no rainfall is expected over the next week. This increases risk ahead of the new winter wheat planting season.
🇦🇺 Better weather in Australia is reducing part of the global weather premium. ABARES raised its wheat production estimate to 29.9 MMT, 12% above the June forecast. This is one of the few factors currently limiting wheat upside.
🚢🇺🇸 US wheat export inspections for the week ended August 27 totaled 430.9 thousand t. Cumulative inspections are 28.4% below last year and have reached 22.6% of the USDA forecast, compared with the 25.1% five-year average.
📈 December Chicago wheat rallied $1.07/bu from last Tuesday’s low to the overnight high, making short-term profit-taking logical. However, the fundamental backdrop remains bullish due to Black Sea disruptions and extreme drought in the southern Plains.

Bottom line: Wheat has given back most of its overnight gain after reaching a new 3.5-year high, but fundamental support remains strong. The rejection of the grain corridor proposal, attacks on Ukrainian infrastructure, the Danube vessel queue, weak Ukrainian exports and southern Plains drought continue to support the market, while an improved Australian outlook and overbought conditions may limit further upside.