Special Edition – Market Trends Report – USDA Report July 7, 2025
Podcast: Play in new window | Download
Subscribe: Apple Podcasts | Spotify | RSS
US and the World
It is that time of year again. The July 4th weekend always represents a critical moment in the market year where prices can go one way or the other. Summer heat is ramping up across the greater American corn belt which may or may not impact what has been to this point very good crop in the United States. As of June 22nd, corn was rated 70% good to excellent and soybeans were 96% planted and 66% good to excellent. Of course, it is a long way from the harvest finish line. On June 30th the USDA weighed in with their latest acreage numbers.
The June 30th USDA acreage report is one of the bigger reports of the year. This is where the USDA adjusts March 31st acreage estimates. In the report USDA said farmers planted 95.2 million acres of corn this past spring which is a decline of about 100,000 acres from the March estimate. It is also down 7% from a year ago. Having said that, it is still the third largest acreage since 1944. Corn stocks on June 1st, 2025, came in at 4.64 billion bushels which is down 7% from a year ago.
On the soybean side of the equation the USDA reduced soybean acreage by 100,000 acres putting it down to 83.4 million acres this was 4% less than a year ago. Both the corn and soybean estimates were within pre report estimates and the markets reacted accordingly. Soybean stocks as of June 1st, 2025, came in at 1.01 billion bushels which was up 4% from a year ago. US wheat acreage was estimated at 45.5 million acres which was down 1% from a year ago.
On July 3rd corn and soybean futures were lower than the last Market Trends report. Wheat futures were higher. September 2025 corn futures was at $4.20 a bushel. Dec 2025 corn were at $4.37 bu. The November 2025 soybean futures was at $10.49 bu. The September 2025 wheat futures closed at $5.56 a bushel. The Minneapolis September 2025 wheat futures closed at $6.47 a bushel with the September 2026 contract closing at $6.83 a bushel.
The nearby oil futures as of July 3rd closed at $66.50/barrel up vs the nearby futures recorded in the last Market Trends report of $72.98/barrel. The average price for US ethanol in the US was $2.00/gallon, higher than the $1.98/gallon recorded in the last Market Trends Report.
The Canadian dollar noon rate on July 4th, 2025, was .7350 US, about the same as the .7354 US reported here in the last Market Trends report. The Bank of Canada‘s lending rate remained at 2.75%.
Ontario
Ontario is a big province and crop conditions can vary widely depending on where you are. At the present time on July the 7th very warm air has moved into Ontario which is helping crops catch up from a cooler start in late May and early June. There was some replanting of soybeans in the deep southwest up until the June 30th crop insurance deadline. At the same time other soybean crops which had advanced in other parts of the province we’re actually facing aphid pressure. It is the mixed bag.
Ontario wheat harvest is fast approaching but as of July the 6th there really hasn’t been any harvest activity. The crop is approximately 2 weeks later than it was a year ago, but as always weather will have a determining factor on when combines start rolling through southwestern Ontario fields. The hot weather that is greeted us in July will certainly accelerate the harvest date. As always, quality will be about most concerned when the crop is harvested.
Ontario basis levels have been stable since the last Market Trends report. The Canadian dollar at .7350 US has helped erode basis values since earlier this winter. This has happened because the Canadian dollar has gained about $0.04 over this time against the US dollar. As always, it will have a direct effect on Ontario cash prices for grain. As we move into later July it will surely have an effect on cash wheat prices sold off the combine.
Old crop corn basis levels are $1.45 to $1.70 over the September 2025 corn futures on July 4th across the province. New crop corn basis levels were $1.05 to $1.36 over Dec 2025 futures. The old crop basis levels for soybeans range from $2.64 to $2.85 over the November 2025 futures. New crop soybeans range from $2.61 to $2.80 over the November 2025 futures. Ontario SRW wheat prices are flux. For July 2025 new crop the bid is in the $6.43 bu. range. On July 4th the US replacement price for corn was $6.64/bushel. You can access all these Ontario grain prices in the marketing section at http://gfo.ca/marketing/daily-commodity-report/
The Bottom Line
It’s all about crop weather now. It’s an old axiom but it is very true. We have big crops, and we also have big old crop supplies and at this point there’s only one way to take that down which is crop weather in July and August. We will be going into the critical corn pollination period in July and as we all know heat is not good for the corn during this. On the other hand, benign weather into August will set us up for more supply. The trading algorithms have this all-dialed in.
You might also say this for the geopolitical risk always associated with our commodity markets. The US dollar is at a three-year low which is always significant for US commodity prices. Part of this has to do with the sale of US bonds by other countries and the resulting decrease in U.S. dollar value. This has taken place because of the lack of confidence in some of the latest American administrations economic tariffs. However, The US is still the world’s biggest and richest economy, and this can never be negated. They always take care of their American farmers, and this often results with the big crops continually produce regardless of prices.
The other big geopolitical events that continue the Ukraine and Russia war along with the problems in the Middle East with Iran and Israel. However, what we have seen is in the world big supplies, this hardly matters to our commodity markets. Needless to say, you could never completely ignore it. The sun beating down on American crops will likely trump that issue when it comes to our crop price movement.
When you are in an oversupplied market it often can overshadow the big demand numbers that are underpinning it. For instance, USDA is expecting a corn crop of 15.820 billion bushels but keep in mind total usage is set for 15.460 billion bushels. In many ways, that is amazing and any hiccup in that narrative as we continue to move through the crop season will affect prices. Oversupply has led to very cheap prices for grain. That itself has built a lot of demand.
Commodity Specific Comments
Corn
It is the time of the year when new crop corn highs are often in or about to be met especially when you consider that we’re about to go into pollination for the US crop. However, so far, the high for corn prices came in February which is so unusual, and we have dropped about $0.65 a bushel since then. So, some fresh news especially regarding crop weather might be the only avenue to get some of that back.
As of July, the 4th, keep in mind that the USDA is predicting corn production to come in at 15.820 billion bushels. That is a lot of corn, and it would not be surprising to see this number go over 16 billion bushels. That reality would keep us into a tough marketing situation. On the other hand, we aren’t there yet, and the critical pollination awaits.
The September 2025 corn contract is currently priced at 15.25 cents higher than the December 2025 contract a bearish indication of new crop corn demand. Seasonally, we know that corn prices tend to peak in early June and bottom out in early October. The July 2025 corn futures contract is at the 19th percentile of the past five-year price distribution range.
Soybeans
Are soybeans going to save the day? We surely hope so much will depend on August rains to affect soybean futures violently one way or the other. China is still important in the equation as they usually buy about 1/4 of American soybeans. South America is coming off a very good crop so it is hard to tell whether American demand will pick up. As it is, the American administration is negotiating with the Chinese for a trade deal, after just finishing one with Vietnam.
Soybean oil has been a bit of a star in the soybean complex currently trying to break through 2025 highs. American demand for their own soybean oil is structurally dynamic and growing. This will continue to serve as a long-term support or North American soybean prices.
The August 2025 soybean contract is currently priced .16 cents above the September 2025 contract considered neutral to bearish for soybean demand. Seasonally, soybean prices tend to peak in early July and bottom out in early October. The November 2025 soybean contract is currently at the 17th percentile of the past five-year price distribution range.
Wheat
Wheat prices continues to confound as it is growing almost everywhere and there is no low supply of wheat as of July 2025. In fact, if we look back the highs in wheat so far were in February. Wheat prices have dropped $1.50 since then. The US dollar at three years lows should help the US wheat market which in turn should help us here in Ontario. However, it’s not quite as simple as that because at the moment we are where we are. Wheat prices simply are not hard spot now.
In Ontario as of July the 4th wheat harvest is still upcoming it is approximately a week to 10 days later than a year ago, as always wheat farmers are hopeful or a good crop. Quality concerns are always an issue with Ontario wheat producers still hoping for a dry window in the middle of July to get off to a good start. The Canadian dollar continues to be a big part of Ontario wheat prices.
The Bottom Line (cont.)
When we think of geopolitics, we usually don’t associate that with the value of Canadian dollar and the relationship between Canada and the United States. However, both the US and Canadian government have set as a goal some type of trade and security agreement in and around July 21st. This will have a definite effect on the value going forward on the Canadian dollar and could easily spring it toward $0.80 cents US if there is a successful agreement. The resultant basis depreciation in Ontario will be palatable and it’s something that we need to consider as we move ahead.
It’s always hard to know. However, the passage of the US “big, beautiful bill” will have big effects in the United States. According to the Congressional Budget Office it adds roughly $2.4 trillion to the US deficit over the next 10 years. Others say that it will add over $4 trillion with other externalities coming into play. In other words, initially there will be a huge stimulus of government spending which might drive the US dollar down. When that happens, the Canadian dollar gains. Needless to say, this is a complex play no matter how you look at it from an economic standpoint. The effects on Canadian cash grain prices will likely be very real but are difficult to determine right at this time. It is all a theory now.
As stated earlier, it’s all about the weather now going forward for our crop prices at least for the next three weeks. However, keep in mind you should always keep abreast of future spreads and what they’re saying. It can be complicated, but keep in mind for instance right now the January March 2026 soybean futures spread is covering 43% of the cost of commercial carry versus 46% last week. In layman terms, this means the market is growing more bullish early next year for the crop you’re growing in the field now. With so many market factors to consider, this is just another one. However, it shows you how complex marketing can be. We need to capture profitable prices when they arise. Certainly 2025 has had a scarcity toward that.
The challenge for farmers is always to separate the noise from what really matters, and in mid-July, that usually starts and ends with the weather. With the crop made in parts of the U.S. and just getting started in others, market direction remains uncertain. Throw in a volatile U.S. dollar, the passage of a multi-trillion-dollar stimulus bill, and shifting trade currents, and you’ve got a recipe for price movement that can change quickly. Here in Ontario, the wheat harvest will offer our first real test of local basis strength, while soybeans and corn stretch toward pollination and beyond. Daily market intelligence is essential to navigate it all — the crop in the field isn’t priced yet, and there will be many grain marketing opportunities ahead.
