Grains & Sugar Weekly 08/01/2025

Corn

Corn futures broke sharply early in the week, sliding to test contract lows before stabilizing in the final sessions. Despite scattered strength tied to export and ethanol demand, the market continues to struggle with follow-through momentum.

The July acreage report offered only a minor reduction in planted and harvested acres, and favorable growing conditions persist, keeping production prospects high. Crops are now entering key development stages where stress could have a modest impact, but overall conditions suggest limited downside risk. Ratings remain strong, maintaining the market’s record yield expectations.

Traders are closely monitoring weather developments, early harvest activity in the southern U.S., and global trade flows. While relations have improved and some agreements have eased concerns, late-week headlines revealed new U.S. tariff enforcement measures affecting nearly 70 countries, suggesting ongoing uncertainty.

Brazil’s Safrinha crop is nearly 75 percent harvested, and added global supplies may pressure prices further. Still, U.S. export sales remain firm, and the downside target near $4.00 has attracted some support.

Key Levels: Support at $4.00 with bears eyeing $3.90 to $3.75. Resistance rests at the 20-day moving average, with heavier upside weight between $4.25 and $4.35.

Soybeans

Soybean futures extended losses this week, breaking below $10.00 to test minor support near $9.90. As prices approach contract lows, technical indicators reflect oversold conditions, with RSI currently sitting in the low 30’s. Further declines could trigger buyer interest if RSI dips below 30.

Caution prevails as the market trades near depressed levels with a long stretch remaining in the growing season. Weather models continue to show a neutral to favorable outlook, limiting bullish catalysts.

However, trade headlines offered some relief late in the week. Statements from Washington signaled progress in U.S. and China negotiations, calming market nerves, although a formal deal appears distant. In the meantime, China continues to rely heavily on Brazil and Argentina to meet demand.

Export sales were moderate, but after months of light interest and growing global supply, the market will likely require a significant bullish trigger to reverse course.

Key Levels: Initial support at $9.90 to $9.75, with stronger interest down to $9.50. Resistance stands at $10.15 to $10.30, capped by converging moving averages.

Wheat

Wheat futures posted fresh contract lows on Thursday and again Friday before stabilizing on end-of-week short covering. Pressure has persisted since early July, fueled by harvest progress and seasonal supply pressure.

While U.S. demand remains strong, with this week’s export sales hitting the top end of estimates, the dollar’s strength and ongoing trade concerns may slow global buying in the second half of the year.

Geopolitical tensions added complexity. Bangladesh announced a purchase of 222K metric tons of U.S. wheat following signals to increase reliance on American supply. Meanwhile, Black Sea instability escalated as Russia intensified attacks, prompting President Trump to shorten a ceasefire deadline.

Forecast revisions added more intrigue, as SovEcon raised Russia’s 2025 wheat export outlook to 43.3 million metric tons, up from 38.3, while Ukraine’s production estimate fell by 2.8 million metric tons to 19.8.

Technically, RSI sits at 34.75, suggesting wheat is nearing oversold territory. Should prices break further, the $5.00 mark may attract meaningful buyer interest.

Key Levels: Support at $5.00, with deeper buying likely below. Resistance at $5.35 to $5.50, where the 20-day and 50-day moving averages and 23.6 percent Fibonacci retracement converge.

Sugar

Sugar futures opened higher this week, holding above the 20-day moving average before retreating sharply after failing at resistance near the 50-day and 23.6 percent Fibonacci retracement levels.

The failure triggered sell stops and pushed prices lower, testing levels below the 20-day.

With few supportive factors, prices could revisit sub-$0.1600 levels. Better production outlooks in Brazil and favorable growing conditions in India have raised expectations for increased global supply.

Traders are also watching for U.S. substitution trends in sweeteners. While no new policy has emerged, speculation persists that some manufacturers may switch to cane sugar, offering a potential lift to domestic demand.

Absent a major headline, sugar appears vulnerable to further drift toward contract lows.

Key Levels: Support at $0.1575, with downside targets near $0.1550 to $0.1525. Resistance remains firm at $0.1650, with heavier selling pressure at $0.1700.