Market remains volatile for soybeans and firm for corn

According to this week's Grão Direto Expert Analysis, the agricultural market was marked by uncertainties, with emphasis on the rains that affected the harvest of soybean in Argentina and for the exchange rate volatility in Brazil after changes in the IOF. While soybean prices continue to be sideways and exports are buoyant, corn shows strength with the progress of the second crop harvest and expectations of record production.

How did the soybean market behave? 

Rainfall in Argentina: Climate problems persisted in Argentina, with heavy rains delaying the soybean harvest, generating estimated losses and impacting grain quality.

Brazilian exports: Brazil continues to show strength in exports, confirming the good volume of soybeans shipped in the first months of the year.

Chicago and exchange: Soybean prices in Chicago had a busy week, influenced by the price of soybean oil, while the exchange rate was unstable after the announcement of the increase in the IOF rate by the federal government.

In Chicago, the July 2025 soybean contract closed the week at US$ 10,61 per bushel, up 0,95%. The March 2026 contract also rose, closing at US$ 10,70 per bushel (+1,71%). The dollar fell slightly by 0,35%, closing the week at R$ 5,65. In the physical market, soybean prices varied depending on the region, indicating indecisive price movements amid volatility.

What to expect from the soybean market?

Challenges of the 25/26 harvest: The 2025/2026 soybean harvest is looking challenging with the continued rise in fertilizer prices. KCL and MAP have been recording consecutive increases for three weeks, mainly due to China's decision not to negotiate with India due to geopolitical issues. This forces India to seek inputs in other markets, increasing global competition and putting pressure on costs.

In addition, rural credit remains expensive, with no prospect of a drop in the Selic rate, making financing more expensive. Volatility in the international market, also due to geopolitical factors, remains intense, making it difficult to "lock in prices", with opportunities only arising occasionally and requiring great caution.

Climate: Despite the volatile weather conditions in the US harvest and excessive rainfall in Argentina, soybeans remained stable (sideways) last week. Investment funds maintained balanced positions, making strong sales of meal and purchases of oil and soybean grains. In the US, the weather remains favorable, but negative margins for local producers may still limit replanting efforts. In Argentina, although excessive rainfall may put pressure on prices, the market appears to have already largely priced in this risk.

Exchange: The dollar is subject to volatility, especially with the current fiscal uncertainty in Brazil – the recent change and reduction in the IOF rate is a clear example. In addition, the market is already starting to price in the political scenario of the 2026 elections, influencing economic expectations and the behavior of the currency. The necessary government actions to balance the budget, whether by increasing revenue or through fiscal adjustments, will probably bring new exchange rate fluctuations over time.

Based on the factors presented, the exchange rate really stands out as a crucial vector for soybean pricing in Brazil, with internal uncertainties potentially generating increases in the dollar and specific marketing opportunities. However, the fundamentals of the grain in Chicago are at a moment of high sensitivity, with the market closely monitoring every detail of the initial development of the American harvest, which will be decisive for global supply. How did the corn market behave? 

Brazilian off-season: The development of the second corn crop in Brazil continued to encourage the sector, with a satisfactory pace and the beginning of the harvest in some regions. Expectations continue to grow for a possible record harvest this year.

Internal prices: Corn showed a slight recovery after periods of decline, with the market more stable at the end of the week. Adverse weather in important producing regions around the world continues to be a factor supporting global prices.

Drought in the USA: the climate situation in the United States has been on the radar, with reports of severe drought and low soil moisture in crucial corn-producing states such as North Dakota, South Dakota and Nebraska.

In Chicago, corn closed the week at US$4,59 per bushel, up 3,61%. On B3, the July 2025 contract closed at R$63,10 per bag, up 1,69%. In the Brazilian physical market, declines predominated in all producing regions.

What to expect from the corn market? 

Bird flu: Despite the recent confirmed case of bird flu in a commercial laying farm in Montenegro (RS), the market understands that the impact on the prices of its cereals will be limited. This is because the main importers – such as Saudi Arabia, Mexico, Japan and China – have adopted specific embargoes, restricting only exports from the affected location, and not from the entire country.

With the rapid implementation of all health measures, the market is expected to return to normal within 30 days. Even though Brazil is the last major exporter to register a case on a commercial farm, this is not expected to significantly pressure grain prices, given the firm global demand for chicken protein, which supports demand for feed.

Corn 2nd crop: The second corn harvest has already begun in some regions of the Midwest and, with an expected production of over 2 million tons, the progress of the work should put downward pressure on prices in the next three months. This year, it is worth noting that there was a greater volume of future sales on its part, taking advantage of the better prices at the beginning of the cycle to ensure a more favorable average price. Despite the pressure of the harvest, demand for the cereal tends to be high, sustained by livestock farmers with positive margins and by the continuous gain in space of corn-based ethanol plants.

The expected large harvest for the second corn crop is expected to exert strong pressure on prices in the coming days and weeks, making a negative bias for prices the most likely scenario. Firm demand and early sales may help moderate the declines, but the large harvest volume should be the main factor dictating the market direction in the short term.