Chicago corn, wheat and soybean futures all moved lower in morning trading on Wednesday, pressured by a sharp decline in crude oil prices after an apparent ceasefire agreement between the U.S. and Iran eased fears of prolonged supply disruptions in global energy markets.
The ceasefire, which reportedly includes provisions to reopen shipping through the Strait of Hormuz, has reduced concerns about constrained oil and fuel supplies — key drivers of biofuel demand and broader commodity inflation.
Energy markets reacted swiftly. Benchmark crude oil futures plunged more than 10 to 15% overnight, with Brent crude falling to roughly the low-$90/barrel range and U.S. West Texas Intermediate (WTI) dropping sharply into the mid-$90s. The move marked one of the largest single-day declines since the early pandemic period and a dramatic reversal from recent highs above $110/barrel just days earlier.
The selloff in crude oil weighed on the grain complex, although the declines in corn and soybeans were only modest. Corn futures were trading between 5 and 6 cents/bu lower as of about 9 am ET, while soybeans were just 1-3 cents lower.
Wheat futures were seeing the largest losses this morning, with the benchmark Chicago market down 18-19 cents/bu. Improving weather for the U.S. winter wheat crop was adding to the pressure on wheat.
The ceasefire has injected a degree of optimism into global markets, but questions remain about its durability, with some missile strikes still reported this morning.
