Wednesday June 4th, 2025

• Markets are starting the day higher due to moderate speculative short covering amid Black Sea war tensions and U.S. trade developments.
• Tariff Talk: The Trump administration has set a deadline of July 8th to finalize new trade deals. Countries have been asked to submit proposals by the end of today to expedite negotiations.
• The new-crop soybean contract carved out one-month lows yesterday before working higher. The strength appears to be more of a technical bounce.
• U.S. weather forecasts have shifted drier in some areas, with some models calling for extremely limited rainfall in the Corn Belt over the 8–14 day period.
• Smoke from Canadian wildfires is affecting parts of the northern US. Short-term exposure generally has minimal effects on crops, but long-term exposure during key developmental stages could potentially reduce yield and crop quality.
• Ukraine’s grain production is expected to decline this upcoming season, with total grain output forecasted to fall by 10%. The drop is being blamed on an unusually warm winter and excessive rainfall during spring planting. The ongoing war with Russia continues to disrupt crop production.
  • Peace talks began this week in Turkey, though both sides are believed to be far from reaching a peace agreement. Recent escalations have increased the risk of disruptions to commodity movement through the Black Sea, but that risk is currently considered to be below 50%.Traders are closely monitoring the situation.
  • So far, Black Sea wheat exports have been mostly unaffected by the conflict. See the chart below.