Soybean and corn futures rose in overnight trading, triggered by expanding drought across the U.S. Midwest, including Illinois, Indiana, Missouri, and Ohio. The U.S. Drought Monitor reported that as of September 2, 2025, roughly 14percent of an 11-state Corn Belt region was under drought conditions-up from 4.5percent a week earlier and 11percent three months ago, though still well below the 32percent recorded at the start of the year.

Illinois saw drought conditions rise to just under 14percent, while Iowa remained relatively unscathed with 0percent in drought and only 4.1percent abnormally dry.

Crop condition ratings slipped slightly: 65percent of U.S. soybeans and 69percent of corn were rated good or excellent at the start of the week, down respectively from 69percent and 71percent one week earlier. Traders priced in this emerging weather risk: November soybean futures climbed 2¾¢ to $10.3575/bu, corn futures increased 2¾¢ to $4.2250/bu, and wheat futures also rose across Chicago and Kansas City contracts.

Ethanol production and stocks ticked upward, with weekly output rising to 1.075 million barrels per day for the week ending August 29-the highest in three weeks. Production gains were seen across the Midwest, Gulf Coast, West Coast, and the Rocky Mountains, while East Coast output slid slightly. Ethanol inventories edged up to 22.564 million barrels.

A freeze watch was issued for parts of western North Dakota, where overnight temperatures are expected to dip near 30°F, with additional freezing possible Saturday night into Sunday. This cold spell poses risks to spring wheat, approximately 62percent harvested as of early September.