After a steady start to the grain trade Sunday night, row crops are all lower, while wheat turned mixed. The hard wheat pricing is firmer as French milling wheat gains $1.50/MT to $ 204.25, while Euronext Nov corn prices push new 52-week highs, gaining $5.00/MT and trading at $226/MT. That’s a gain of $24 in two weeks and one day. (Over $0.70 a bushel gain). Euronext corn is non-GMO, so for now, we need to wait for those corn buyers to say uncle and lower their standards. Brutal heat in Europe continues for 10 days, affecting corn pollination. European wheat is heading towards harvest, so the trade is less excited about production losses until they can be quantified off the combine.

Attention remains centered on the Middle East after reports that the United States and Iran have agreed to suspend further military strikes and hold talks in Qatar later this week. The discussions are expected to focus primarily on the Strait of Hormuz and the implementation of the proposed memorandum of understanding. Crude oil this morning is hovering near 70.00 a barrel, up almost $1 from last Friday’s settlement.

Shipping activity through the Strait has improved from the lows seen during the conflict, with vessel traffic now estimated at roughly 50-60 ships per day, down from about 125 before hostilities began. Even so, negotiations are expected to be difficult. Iran continues to seek a significant role in controlling traffic through the waterway, making it unlikely this will be the last disruption to one of the world’s most important energy corridors. Elevated war risk insurance premiums also remain in place, while Oman’s decision to offer an alternative shipping route without transit fees has added another point of tension in the negotiations.

Looking ahead, traders will be watching three developments closely: the outcome of the US-Iran negotiations in Qatar, shipping volumes through the Strait of Hormuz, and the start of the Atlantic hurricane season, which could introduce another layer of uncertainty for energy markets.

Tomorrow is the largest crop report of the year, the June Stocks and final 2026 Seedings estimates (which will be updated numerous times over the next 2-3 years) at 11:00 a.m. Data from the FSA Farm participation programs will not be implemented until the August crop report or later. Corn acreage is centered around 95 Mil acres, while soybean production is pegged near 85.3 Mil acres. Corn would be down 300,000 from March 31, with soybeans showing a gain of 700,000 acres. Spring wheat is up 100,000 acres from the March 31 data at 9.5 million acres. This would still be down 500,000 acres from last year. 

Participation from farmers is likely under 40% in tomorrow’s data, making all numbers susceptible to error, and a lack of seasoned NASS personnel, who have also taken early retirement over the past year, further undermines accuracy. Still, the market will relish the opportunity to trade on a headline, with algo-reader computerized trading jumping within a nanosecond of the missed numbers being read.

You can read what a lot about weather models all you want, as a lot of them have to deal with corn that has a shallow rooting system and is going to experience some heavy heat this week, and some models retrograde the heat away after July 10, while some question that, possibly keeping the warm nights in place beyond that window, building concern about how Midwest weather will play out during pollination. This will be part of the extreme volatility this week, with markets having only a four-day trading window, with Thursday likely to have light participation, implying we really have only three trading days of heavy volume this week. This is not the week to be trading large positions, but to be conservative in your application of trading ideas.