The U.S. grain complex suffered a broad downturn Tuesday, with December corn futures closing down 5 cents at $4.18 per bushel, extending losses after early-morning trade. November soybeans settled 9½ cents lower at $10.31½ per bushel, while December Chicago Board of Trade (CBOT) wheat fell 6¼ cents to $5.22. Both Kansas City and Minneapolis wheat futures also edged down.

The downturn in soybean prices reflects mounting concerns over China's absence from the export market, a trend that continues to weigh on U.S. soybean demand expectations. Analysts noted that a strengthening U.S. dollar further exacerbated bearish sentiment, making American agricultural exports less competitive globally.

Meanwhile, December corn futures retraced gains made late last week, when prices were supported by strength in energy markets. "Corn's strong price action from late last week carried over, supported in part by crude oil gaining more than $1.50," said Cole Raisbeck of Kluis Commodity Advisors. However, with crude oil reversing and closing $1.71 lower at $63.88 per barrel, corn markets lost momentum.

USDA crop ratings for soybeans showed a 4-point decline, in line with expectations following a dry August across much of the eastern Corn Belt. While the downgrade could offer some support, traders largely priced in the weather effects.

One bright spot came from USDA's morning export announcement: the Philippines booked 185,000 metric tons of soybean cake and meal for the 2025/2026 marketing year. Still, this was not enough to offset broader weakness.

In the wheat sector, global supply concerns have abated, and with ample carryover stocks and sluggish export sales, futures slid again. December KC wheat dipped 1 cent to $5.10¼, while Minneapolis wheat declined 1¼ cents to $5.73.

Livestock markets also retreated, with October live cattle down $1.20 at $238.33 per hundredweight (cwt). Feeder cattle dropped $2.20 to $361.50 per cwt, while lean hogs fell $1.73 to $93.83 per cwt. Livestock weakness was attributed to technical selling and seasonal demand shifts heading into fall.

Markets faced broader financial headwinds as well. The S&P 500 closed up 32.72 points, signaling modest investor optimism, while the Dow Jones Industrial Average slipped 24.58 points. The U.S. Dollar Index September contract hovered near 98.26, strengthening against key currencies and weighing on ag commodities.

Producers and ag investors now turn their attention to upcoming USDA reports and export data for signs of a market turnaround. Eyes will also be on weather updates as harvest season approaches.