Last week your loyal scribe finished up his wheat harvest and then for the next few days I got to watch as my neighbors do the same.   Wheat harvest can be the most frustrating because of all the risk associated with it but of course it also can be the most satisfying because it’s about the only crop I take off when in my shirt sleeves.  As we move ahead, like I say often, we’re hoping for good things. Hopefully the weather will be kind for the soybeans and corn left in Ontario fields.
 
     August should provide a bit of drama for our commodity markets and local cash grain prices. However, keep in mind it seems a little bit late for corn pollination to be affected. Yes, there’s drought in much of Ontario which is no fun.  We also know that soybeans who are the great liars (you never know what they will yield) always appreciate their August rains to give them yield. We will see if that happens.  USDA is predicting 52.5 bushels per acre. We will see if the weather is kind.
 
      For those of you who are growing soybeans timely August rains will be important. They will be important because as I write this, we have September 2025 soybean futures at $10.05. Many of you have expected it to be down even further and of course we all hope it goes up like a rocket.  At the present time as we wait for those August rains future spreads support a bearish soybeans market environment.
 
     The question farmers need to ask themselves is does this make sense? For instance, there’s no question the market is never wrong but how much validity is there to these soybean prices?  Are market bears getting a little bit too confident?
 
When you look at the demand for soybean oil you would almost think so. For instance, I have written about this before. Stronger renewable fuel standards in the United States as well as section 45-Z enhancements to the clean fuel production credit have boosted soybean oil demand.  For instance, according to the latest USDA numbers about half of US soybean oil production or about 15.5 billion pounds in 2025/26 will now be utilized by American biofuel makers. This represents a 26.5% increase from a year ago. Think about that for a little bit That’s just amazing demand for soybeans.
 
Yes, keep in mind it is a double-edged sword as we crush more soybeans for oil but we get more meal as well so meal can be a drag on soybean prices. Needless to say, there is something to this.  In other words, intuitively if you think about that 52.5 bushel per acre yield the USDA is projecting for this year, they better be right. Any variation on that theme to the downside will send soybean prices up based on your loyal scribes flawed thinking.
 
     Keep in mind that I write ad nauseum about corn, soybean and wheat markets.  My thoughts appear on DTN, but they also show up possibly in a more objective technical fashion in Market Trends for the Grain Farmers of Ontario. Through the years I have pressed all of my cranium capacity based on my Master’s degree in agricultural economics on deciphering price movement. At times when you look at commodity prices as much as I do there is a tendency to follow what the herd is saying. As we sit here in 2025, clearly that means that the bears are in control and believing anything else is almost impossible.
 
     Clearly though, that is a bias you don’t want to have. Soybean oil demand is one factor that floods the zone against that.   It’s a structural component within our soybean demand complex which isn’t going to go away and in fact will likely continue to grow.  Now, what to do with all that meal?
 
     We will see.  However, you would think that would be good for Ontario soybean prices with US crushers chasing oil margins.  It’s pretty obvious this year if soybean yields tumble with a dry August soybean futures might have to ration demand. Add structural demand for soybean oil which will not go away in the near future.
 
     With August on the short-term horizon marketing those soybeans growing in the field will continue to challenge us. Keep abreast of that 52.5 bushel per acre USDA yield, we’ll see if it’s carved in stone by the end of the month.  If Mother Nature does not play nice in August soybean fields maybe the shift in soybean oil demand will act like lighter fluid under soybean prices. We keep going, with our eyes wide open.