Grain futures ended lower on Tuesday, weighed by technical selling, global competition, and cautious weather outlooks. But as markets react, another question takes center stage: how accurate are USDA's August yield estimates?

Grain market veteran Bryce Knorr says historical data shows mixed results. Over time, August corn yield estimates were too high 53.3% of the time and too low 46.7%, with average deviations of around 5%. Soybean estimates proved even tighter, being off in either direction roughly half the time.

Corn Slips on Technical Selling and Weather Trends

Corn futures fell Tuesday, with September down 3.5 cents to $3.7950 and December off 3.25 cents to $4.0325, driven by a mix of technical pressure and weather concerns. The latest crop condition report showed 71% of corn rated good-to-excellent, a one-point drop from last week.

• 97% of corn is silking, just shy of the 5-year average

• 72% is in the dough stage

• 27% is dented, while 3% is mature

Rainfall remains limited, with most of the Corn Belt unlikely to receive more than 0.5" through Saturday. The 8-14 day NOAA outlook suggests cooler, wetter conditions in the West, but the central U.S. remains uncertain.

Meanwhile, Brazil's corn exports are surging, projected to hit 316.9 million bushels in August, adding pressure to U.S. markets. Egypt's recent tender for 2.4 million bushels adds another layer of competition.

Soybeans Drift Lower Despite Strong Mexico Demand

Soybean futures also trended lower, with September down 7.75 cents to $10.13 and November off 7.5 cents to $10.3375. This came despite news of a large Mexican purchase: 8.4 million bushels for delivery in the 2025-26 marketing year.

• 68% of soybeans rated good-to-excellent

• 95% of the crop is blooming, and 82% is setting pods

Elsewhere in the soy complex, soymeal climbed 2.5%, while soyoil dropped nearly 3%. Brazil's soybean exports are expected to hit 327 million bushels in August, surpassing last year's volume and contributing to bearish pressure.

Wheat Falls Below $5 as Global Supplies Weigh

Winter wheat prices tumbled below $5, a threshold not breached since the 2019-20 season. Chicago SRW futures dropped 4.25 cents to $4.9850, and Kansas City HRW fell 6.75 cents to $4.9950. The 2024-25 harvest is 94% complete, lagging slightly behind recent averages.

Spring wheat harvest surged from 16% to 36% week-over-week, while quality ratings improved to 49% good-to-excellent. EU soft wheat exports are off to a sluggish start, and Egypt's domestic wheat procurement is up 16% year-over-year, but still below target.

Markets React to Mixed Signals from Wall Street and Energy

On Wall Street, the Dow briefly touched record highs before retreating 77 points to close at 44,833. Crude oil dropped over 1%, falling below $63 per barrel, and is down nearly 5% for the month. The U.S. dollar firmed slightly, adding minor headwinds to exports.

Bottom Line for Ag Professionals

• Grain prices fell across the board, driven by technical pressure, weather forecasts, and foreign competition.

• USDA's August yield projections have a history of 5% deviation-accurate some years, significantly off in others.

• Corn and soybeans show mixed crop conditions, while wheat harvests near completion.

• Brazil's aggressive export pace continues to undercut U.S. global competitiveness.

• Ag professionals should watch early September data, which historically correlates more closely with final yields.