Key Takeaways
- • Ukraine-Russia conflict escalates wheat market volatility: Drone attacks on Russian ports via the Azov Sea restrict export capacity, driving wheat prices higher last week; USDA reduced production to 1.531 billion bushels with ending stocks cut to 717 million bushels amid reduced Black Sea shipping.
- • Corn production raised but yield cut: USDA increased harvested area to 88.6 million acres (from 87.4 million) while reducing yield to 180.7 bu/acre (from 184 bu/acre), resulting in production of 16.013 billion bushels; export demand boosted to 3.275 billion bushels and ending stocks reduced to 1.653 billion bushels.
- • Soybeans gain on Chinese demand and weather: China purchased 136,000 tons of U.S. soybeans; USDA increased crush to 2.780 billion bushels (up 30 million bu) while raising harvested area to 85.8 million acres; ending stocks estimated at 320 million bushels with cooler, wetter conditions expected in northern Midwest.
- • Cotton production trimmed amid below-average conditions: USDA lowered cotton production to 13.61 million bales (from 13.7 million) with ending stocks at 3.0 million bales; crop conditions remain significantly behind year-ago levels despite normal boll-setting progress.
- • Rice ending stocks elevated on increased USDA estimates: USDA raised harvested area and production with long-grain production at 106.7 million cwt; long-grain ending stocks increased to 20.3 million cwt (from 17.7 million), pressuring prices despite moderate-to-poor export demand.
Summary
Grain and oilseed markets showed mixed performance during the week ending August 17, 2026, driven by geopolitical tensions, USDA production revisions, and regional weather patterns. The Ukraine-Russia conflict intensified as Ukrainian drone attacks on Russian ports restricted export flows through the Azov Sea, limiting Russian wheat shipments and supporting wheat prices. Concurrently, the USDA released August estimates that modestly reduced wheat production to 1.531 billion bushels while maintaining total demand at 1.874 billion bushels, resulting in lower ending stocks of 717 million bushels. U.S. wheat harvest exceeded 81% completion, with spring wheat rated 51% good to excellent. Regional conditions remained uneven: Midwest harvests progressed normally with scattered showers and moderate temperatures, while the Great Plains faced persistent heat and dryness, and Texas experienced harvest delays due to excessive rain with below-normal yields.
Corn markets responded positively to the USDA August report despite near-term weather concerns. The agency raised harvested area to 88.6 million acres while reducing yield to 180.7 bushels per acre, yielding total production of 16.013 billion bushels. Export demand increased to 3.275 billion bushels (from 3.2 billion), with domestic use unchanged at 13.055 billion bushels, producing ending stocks of 1.653 billion bushels. Dent corn progress ran ahead of normal, though temperatures in the Midwest moderated during the week. Brazilian production estimates remained a source of weakness. Open interest in CBOT corn futures stood at 2.27 million contracts as of August 11, with non-commercial traders holding 242,139 long and 203,146 short positions.
Soybean markets benefited from Chinese import activity and improved northern weather. China purchased 136,000 tons of U.S. soybeans during the reporting period. The USDA raised harvested area to 85.8 million acres and increased the crush forecast to 2.780 billion bushels (adding 30 million bushels), while ending stocks were projected at 320 million bushels. Rapid pod development and blooming progress were noted, though conditions remained slightly below year-ago levels. Cooler temperatures and wet weather are forecast for northern Midwest areas, while the southern Midwest remains hot and dry. Soybean oil and soybean meal prices reflected modest strength, with soybean oil open interest at 711,680 contracts and soybean meal at 656,966 contracts.
Rice markets declined on harvest pressure and rising ending stock estimates. The USDA increased both harvested area and production, with long-grain production pegged at 106.7 million cwt and long-grain ending stocks rising to 20.3 million cwt (from 17.7 million previously). Total ending stocks reached 36.0 million cwt. Export demand remained moderate to poor despite adequate supplies. Brazilian palm oil exports during August 1-15 rose 3.2% month-on-month to 667,257 metric tons, supporting prices in oilseed complexes.
Cotton production was trimmed by the USDA to 13.61 million bales (from 13.7 million) with ending stocks at 3.0 million bales. Despite normal boll-setting and squaring progress, conditions remain significantly behind year-ago levels, with deterioration observed last week as bolls began opening. Scattered-to-isolated showers are forecast for Delta and Southeast regions, with warm-to-hot temperatures throughout cotton-growing areas. December cotton futures showed mixed-to-down trends with support at 74.50 and resistance at 89.30.
Commodity Futures Trading Commission data as of August 11 revealed substantial positioning across grain and oilseed contracts. In CBOT wheat (soft red winter), open interest totaled 581,798 contracts with non-commercial traders holding 56,834 long and 106,232 short positions, while index traders maintained net short exposure. Hard red winter wheat open interest stood at 345,187 contracts with less pronounced positioning imbalances. Weather patterns and geopolitical disruptions will remain key drivers for the remainder of the harvest season.
Corn markets responded positively to the USDA August report despite near-term weather concerns. The agency raised harvested area to 88.6 million acres while reducing yield to 180.7 bushels per acre, yielding total production of 16.013 billion bushels. Export demand increased to 3.275 billion bushels (from 3.2 billion), with domestic use unchanged at 13.055 billion bushels, producing ending stocks of 1.653 billion bushels. Dent corn progress ran ahead of normal, though temperatures in the Midwest moderated during the week. Brazilian production estimates remained a source of weakness. Open interest in CBOT corn futures stood at 2.27 million contracts as of August 11, with non-commercial traders holding 242,139 long and 203,146 short positions.
Soybean markets benefited from Chinese import activity and improved northern weather. China purchased 136,000 tons of U.S. soybeans during the reporting period. The USDA raised harvested area to 85.8 million acres and increased the crush forecast to 2.780 billion bushels (adding 30 million bushels), while ending stocks were projected at 320 million bushels. Rapid pod development and blooming progress were noted, though conditions remained slightly below year-ago levels. Cooler temperatures and wet weather are forecast for northern Midwest areas, while the southern Midwest remains hot and dry. Soybean oil and soybean meal prices reflected modest strength, with soybean oil open interest at 711,680 contracts and soybean meal at 656,966 contracts.
Rice markets declined on harvest pressure and rising ending stock estimates. The USDA increased both harvested area and production, with long-grain production pegged at 106.7 million cwt and long-grain ending stocks rising to 20.3 million cwt (from 17.7 million previously). Total ending stocks reached 36.0 million cwt. Export demand remained moderate to poor despite adequate supplies. Brazilian palm oil exports during August 1-15 rose 3.2% month-on-month to 667,257 metric tons, supporting prices in oilseed complexes.
Cotton production was trimmed by the USDA to 13.61 million bales (from 13.7 million) with ending stocks at 3.0 million bales. Despite normal boll-setting and squaring progress, conditions remain significantly behind year-ago levels, with deterioration observed last week as bolls began opening. Scattered-to-isolated showers are forecast for Delta and Southeast regions, with warm-to-hot temperatures throughout cotton-growing areas. December cotton futures showed mixed-to-down trends with support at 74.50 and resistance at 89.30.
Commodity Futures Trading Commission data as of August 11 revealed substantial positioning across grain and oilseed contracts. In CBOT wheat (soft red winter), open interest totaled 581,798 contracts with non-commercial traders holding 56,834 long and 106,232 short positions, while index traders maintained net short exposure. Hard red winter wheat open interest stood at 345,187 contracts with less pronounced positioning imbalances. Weather patterns and geopolitical disruptions will remain key drivers for the remainder of the harvest season.
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