Global Outlook for Soybeans, Corn, Wheat, and Vegetable Oils: Climate, Policy, and Biofuels in Focus
Following a strong crop performance in South America—marked by robust corn harvests and excellent soybean yields in Brazil and Argentina—market attention now turns to U.S. production. With the growing cycle still in its early stages, weather conditions across the U.S. and their potential impact on crops will remain under close watch by market participants.
Below is an abridged version of our grain and oilseed market analysis, featured in the 32nd edition of the StoneX Quarterly Commodities Outlook for the July–September 2025 period. Click below to download the full report, which includes insights from the StoneX Market Intelligence team across agricultural commodities, energy, metals, and currencies.
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Soybeans
- Prices fluctuating without major structural shifts
- Ongoing U.S.–China trade tensions still influencing premiums and sentiment
- U.S. weather and planted area are critical to global balance
- Biofuels gaining prominence in demand outlook
Soybean prices have fluctuated throughout the first half of 2025, generally holding above USD 10.00/bushel in Chicago. Despite some stability, developments such as proposed U.S. biofuel blending mandates and renewed trade tensions with China have introduced short-term volatility. The continuous contract closed June at 1,024.25 cents per bushel, a modest 0.9% gain from the previous quarter. According to Ana Luiza Lodi, Market Intelligence Specialist at StoneX, “The global balance remains comfortable, but the market remains vigilant to climatic and geopolitical shocks that could shift the outlook.”
On the supply side, Brazil harvested a record crop and exported significant volumes in H1, while Argentina also posted strong performance, with 50.3 million tonnes produced. In the U.S., although weather has not raised major alarms thus far, a reduced planted area of 33.74 million hectares and unresolved yield potential introduce uncertainties. A disappointing U.S. harvest could ripple across global prices and reshape planting strategies in South America for the upcoming cycle.
Demand-wise, biofuels are emerging as a key growth driver. In Brazil, expectations for an increased biodiesel blending mandate starting in August are fueling greater domestic soybean processing. In the U.S., new policies are expected to boost local crush, while Argentina is likely to maintain steady processing levels and a focus on exporting by-products.
As a result, the global soybean market remains relatively balanced—but with clear risk factors ahead. U.S. weather outcomes and evolving biofuel-driven consumption patterns stand out as potential catalysts for pricing and acreage decisions in Brazil.
Corn
- Global supply set to rise, creating pressure on prices
- Brazil poised to harvest its second-largest “safrinha” crop and expand domestic demand
- U.S. on track for a record crop, though risks remain
Despite early-year concerns over tight U.S. corn stocks, the international market narrative shifted in Q2 2025. A robust Brazilian safrinha crop—estimated at 108.2 million tonnes—combined with strong early-season U.S. crop progress, pushed Chicago prices downward, even as the U.S. stock-to-use ratio held at just 8.9%, the second lowest in a decade. “Expectations of ample supply from top global producers are reinforcing a bearish price environment,” explains Raphael Bulascoschi, Market Intelligence Analyst at StoneX.
In Brazil, planting delays gave way to favorable weather from April to May, leading to one of the largest crops in history and export potential of up to 42 million tonnes in 2024/25. However, domestic demand is surging, largely due to booming corn-based ethanol production, forecasted to reach 9.8 billion liters in 2025. This internal growth is expected to absorb more supply, narrowing export surpluses—though shipments should still exceed 2024 levels.
In the U.S., rapid planting and ideal weather expanded sown area to 38.53 million hectares, paving the way for a potential record harvest near 401 million tonnes. While U.S. exports remain strong for now, rising global supplies—especially from South America and potentially China—could erode U.S. competitiveness in H2. With consumption still robust, market risks such as avian flu outbreaks and weather volatility remain front of mind heading into the second half of the year.
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Wheat
- 2024/25 season marked by subpar prices despite crop losses in the EU and Russia
- 2025/26 forecast points to record global output of 808.5 million tonnes
- Stable production expected in Brazil; Argentina could deliver historic supply
- Global consumption seen rising, while ending stocks may decline modestly
The close of the 2024/25 wheat season confirmed international prices well below the five-year average, despite significant production shortfalls in the European Union and Russia. Ongoing war dynamics in the Black Sea region and stronger inventories in China and India limited any major price recovery. In June, the continuous contract on the Chicago Board of Trade settled at 528.75 cents per bushel—4.6% lower year-on-year.
Looking ahead, the 2025/26 season opens on a more optimistic note. According to USDA forecasts, global production could reach an all-time high of 808.5 million tonnes. In the Northern Hemisphere, winter wheat harvests are progressing with favorable assessments, and spring planting is advancing under good weather. The EU expects a sharp 11.85% rebound in output to 136.6 million tonnes. Meanwhile, U.S. prospects are underpinned by higher beginning stocks, despite reduced planted area.
In South America, the outlook is mixed. Brazil’s wheat crop is projected at 7.7 million tonnes, according to StoneX, though constrained by weaker farm credit and soft prices. Argentina, on the other hand, stands out with potential for a historic harvest, driven by record planted area and an extension of reduced export taxes through March 2026. “The extended tax relief improves the investment capacity of Argentine farmers and strengthens the country’s wheat supply,” notes Ana Luiza Lodi of StoneX..
On the demand side, the USDA projects continued growth in global wheat consumption, particularly for food, industrial, and seed uses. As a result, even with record production, ending stocks are expected to dip slightly to 262.8 million tonnes. This signals a more balanced—but still weather- and geopolitically-sensitive—market heading into 2026.
Vegetable Oils
- EPA’s proposed biofuel targets spark sharp rally in soybean oil prices
- New rules favor domestic feedstocks and improve investment visibility
- In Brazil, higher biodiesel blends set to drive demand in H2
Q2 2025 was marked by volatility in the vegetable oil markets, culminating in the much-anticipated release of the U.S. Environmental Protection Agency’s (EPA) proposed biofuel mandates. Published on June 13, the targets for 2026 and 2027 were a game changer: in just two days, soybean oil prices on the CBOT surged 15.8%, closing the quarter up 17.4% at US¢52.7/lb—the highest level in over 18 months. Key highlights include the bump in RVO targets to 5.61 billion gallons in 2026 and the restriction of RIN credit generation for imported fuels or those made with foreign inputs—clearly favoring domestic raw materials. “The EPA’s measures combine ambition with industry alignment and signal renewed momentum for U.S. soybean oil,” says Leonardo Rossetti, Market Intelligence Analyst at StoneX.
In Brazil, the biodiesel market remains buoyant. By May, cumulative sales were up 7.9% versus 2024, and with the mandatory blend rising from 14% to 15% in August, StoneX revised its 2025 demand forecast to 9.9 million m³—an annual increase of 9.3%. This will likely boost soybean oil consumption in H2. While solid output in Brazil and Argentina stabilized prices earlier in the year, the evolving demand landscape and seasonal declines in soybean crushing could lend additional support in the months ahead.
As for palm oil, Q2 saw a sharp correction, with prices falling 12.4% to USD 940/t. Still, the price differential relative to soybean oil has once again favored palm—particularly in the Indian market, where import demand began to recover in May. With regional festivals approaching and Indonesia increasing its biodiesel mandate from B35 to B40, domestic consumption should remain elevated, potentially tightening exportable supply and supporting global prices.
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