Posted on March, 28, 2025 at 09:48 am
As of March, grain merchandising continues to be shaped by a complex mix of tightening global supplies, shifting demand, and climatic unpredictability. The U.S. Department of Agriculture’s (USDA) latest World Agricultural Supply and Demand Estimates (WASDE) report – and supporting international data – confirm a pivotal moment for U.S. and global traders of corn, wheat, soybeans, rice, sorghum, and related feed grains.
While some commodity balances show more cushion than last year, most markets are being driven by changing trade dynamics, weather-driven production shifts, and increasing volatility in stocks-to-use ratios. Below is a breakdown by crop, with strategic considerations for grain merchandisers and handlers going into mid-2025.
Corn:
Stocks Rise, But Trade Remains Tight
Corn remains a pillar of both U.S. agriculture and the global feed supply. According to the USDA’s March WASDE report, the 2024-25 marketing year shows a slight reduction in total supplies, primarily due to lower import forecasts for barley and oats. However, domestic use fell more sharply, pushing U.S. ending stocks up by 25 million bushels to 2.172 billion. The season-average farm price remains unchanged at $4.75 per bushel.
Globally, the International Grains Council (IGC) reduced projected corn output by 3 million metric tons, primarily due to worsening weather in South America. Most notably, the effective global corn stocks-to-use ratio (excluding China) is expected to fall to 7.8%, its lowest level since 1995-96.
Takeaway: U.S. corn handlers must be cautious of price whiplash tied to weather in Argentina and Brazil. Tight global tradable stocks may offer pricing strength for Gulf exporters despite lackluster domestic feed demand.
Wheat:
Higher Carryout, Declining Exports
U.S. wheat stocks continue to build, now projected at 819 million bushels, up from 794 million last month and 694 million in 2023-24. Exports were revised down to 725 million bushels, reflecting soft demand from Asia and North Africa and increased competition from Black Sea origins.
The season-average farm price was lowered by $0.05 to $7.15 per bushel, further pressuring merchandising margins.
Globally, European Union (EU) wheat exports are expected to fall to 27 million metric tons, their lowest since 2018-19, driven by poor yields and acreage cuts in France and Germany.
Takeaway: With export business lagging, merchandisers should focus on regional-based management and internal movement strategies. Early new-crop sales may need to be price-protected against further global supply rebounds.
Soybeans:
Global Surplus Weighs on Prices
Soybeans face oversupply concerns despite stable U.S. carryout. Ending stocks remain at 315 million bushels, but a 10 million-bushel increase in crush offsets a 20 million-bushel drop in exports (now 1.67 billion). Domestic demand for soybean meal is a key driver.
Internationally, production was raised to 397.2 million metric tons, driven by large crops in Brazil and Paraguay. Global ending stocks are revised down 1.2 million tons, as China continues to increase crush volumes.
Takeaway: With global supplies ample, merchandisers should focus on domestic demand hubs and processor relationships. Exporters should monitor Brazilian logistics for window opportunities.
Sorghum:
Weak Export Demand Builds Stocks
Sorghum exports are expected to total just 155 million bushels, down 10 million from February, mostly due to reduced Chinese demand. As a result, ending stocks rose to 43 million bushels. Prices remain steady at $5.05 per bushel, but relative value versus corn is narrowing.
Merchandising Take: Domestic feeders may continue to avoid sorghum due to cost. Southern Plains merchandisers should monitor export shifts post-harvest and regional blending strategies.
Rice:
Record Imports, Boosted Exports
The U.S. rice market continues to evolve in two directions. Long-grain imports are at a record 48 million cwt., reflecting changing consumer preferences and competitive pricing from Asia. On the other hand, medium-short-grain exports were increased 2 million cwt. to 13 million, driven by Latin American demand.
Overall ending stocks are forecast at 44.2 million cwt., and the season-average farm price for all rice is projected at $16.60 per cwt., up 10 cents from February.
Takeaway: Opportunities for merchandisers lie in navigating port-of-entry handling and maximizing premiums in niche export channels, especially for West Coast rice shipments.
Market Forces and Outlook
Climate and Production
Adverse weather continues to shape global production. Russia and the EU have faced dry conditions, impacting wheat. South America is struggling with inconsistent rain during corn pollination windows. Climate variability remains a wildcard in all balance sheets.
Trade Policy and Tariffs
Tariff-related friction between the United States and key trading partners has impacted both pricing power and trade routes. Retaliatory tariffs and shifting phytosanitary rules are rerouting traditional flows, particularly for soybeans and wheat.
Automation & AI
Grain merchandisers are increasingly turning to digital trading platforms, AI-enhanced risk models, and blockchain systems for lot-level traceability. These tools are enabling real-time decision-making and reducing basis risk, especially in high-frequency bid/offer environments.
Conclusion
The grain merchandising landscape as of March 2025 reflects a highly fluid marketplace. Despite healthy overall stocks in some sectors, the accessibility and tradability of those supplies – especially outside of China – remain a central concern. With uncertain weather patterns, evolving trade routes, and dynamic global demand, merchandisers will need to remain agile, informed, and responsive.
By leveraging real-time data, managing spreads carefully, and fostering strong buyer relationships, grain professionals can continue to create value in a market where margin management is as critical as ever.
Source: Grain Journal