U.S.-Canada Trade Fight Deepens, Putting Farmers in the Middle

An escalating trade dispute between the United States and Canada is creating new concerns for American farmers as retaliatory tariffs and import restrictions take effect. Canada imposed tariffs ranging from 15% to 50% Tuesday on $27.6 billion worth of U.S. imports, according to Canada's Department of Finance. Products affected include agricultural equipment, dairy products, steel, aluminum, appliances and electronics. The action follows new U.S. tariffs on Canadian products. President Donald Trump has responded by announcing restrictions on certain Canadian dairy products and directing federal agencies to begin removing Canadian goods from government purchasing programs. Farmers could feel the dispute from both directions. Canada is a major market for U.S. agricultural products, while American producers also rely on Canadian fertilizer, machinery and other inputs. The uncertainty comes as producers already face elevated production costs and tight margins. Agricultural groups and farm-state lawmakers are watching closely for signs the two governments could return to negotiations.

Corn Harvest Begins as U.S. Crop Condition Continues to Decline

The U.S. corn harvest is underway as farmers enter the final stages of a growing season marked by uneven weather and declining crop conditions. USDA's latest Crop Progress report showed 5% of the nation's corn had been harvested as of Sept. 6, compared with the five-year average of 3%. About 25% of the crop had reached maturity. However, only 56% of the crop was rated good to excellent, down another percentage point from the previous week and the lowest rating of the 2026 growing season. Soybeans continued developing ahead of their normal pace, with 26% of the crop dropping leaves compared with the five-year average of 20%. The declining corn rating will increase attention on USDA's upcoming Crop Production and World Agricultural Supply and Demand Estimates reports. Traders and producers are looking for evidence that late-season weather reduced yield potential after USDA projected a large crop earlier this summer. Harvest will expand rapidly across the Corn Belt during the coming weeks.

Grain Markets Await USDA's September Crop Estimates

Corn and soybean producers are awaiting USDA's September crop estimates, which could provide a clearer picture of how summer weather affected this year's harvest. USDA will release its September World Agricultural Supply and Demand Estimates report Friday, Sept. 11. The report will update projections for U.S. and global production, demand, exports and ending stocks. Market attention is particularly focused on corn. Agriculture.com reports analysts expect USDA could lower its new-crop corn yield estimate following reports of weaker-than-expected crop potential in portions of the Corn Belt. The August WASDE reduced old-crop corn carryout by 75 million bushels and soybean stocks by 5 million bushels. Friday's report comes as corn harvest begins and national crop ratings continue to deteriorate. Any reduction in expected production could tighten projected supplies and provide support for grain prices. Conversely, larger-than-expected production estimates could add pressure as newly harvested grain reaches the market. The report is scheduled for noon Eastern time Friday.

Corn Leads U.S. Export Inspections as New Marketing Year Begins

U.S. grain exporters have started the 2026-27 marketing year with corn accounting for the largest share of export inspections, although early corn and soybean totals remain behind last year's pace. USDA's latest export inspection data showed corn inspections at approximately 1.66 million metric tons for the week ending Sept. 3. Soybean inspections totaled about 422,000 metric tons, while wheat inspections were approximately 343,000 tons. The new marketing year for corn and soybeans began Sept. 1. Early 2026-27 corn and soybean inspections are running behind the comparable pace from the previous marketing year. USDA's export inspection report measures grain that has been inspected for shipment from U.S. ports and provides an early indication of export movement. CME Group notes that the weekly figures precede USDA's more detailed Export Sales report. Export demand will be closely watched as the U.S. harvest expands. Large domestic supplies would make strong overseas demand particularly important for supporting corn and soybean prices.

Black Sea Conflict Keeps Pressure on Global Wheat Market

Continuing warfare between Russia and Ukraine is keeping uncertainty elevated in global wheat markets as attacks threaten transportation and agricultural infrastructure around the Black Sea. Russia and Ukraine remain major participants in the international grain trade, making disruptions in the region capable of quickly affecting wheat supplies and prices. Recent Russian attacks have increasingly damaged Ukrainian food warehouses and logistics infrastructure, disrupting domestic food distribution as well as adding uncertainty to agricultural supply chains. The Associated Press reports Russia has continued heavy missile and drone attacks on Ukraine, while Ukraine has responded with long-range drone strikes inside Russian territory, including attacks near the Black Sea port of Novorossiysk. The conflict comes after wheat prices already rose sharply during August amid concerns about Black Sea supplies and weather problems in other producing regions. For U.S. wheat producers, disruptions to competing Black Sea exports could improve export opportunities. However, volatility is expected to remain high as traders monitor shipping routes, ports and crop supplies.

Late-Season Weather Adds Uncertainty to Midwest Corn and Soybeans

Weather remains a concern for U.S. corn and soybean producers as harvest begins following a growing season marked by periods of excessive rainfall and extreme heat. Flooding during August damaged crops in portions of the Midwest after some areas received more than 12 inches of rain. Farm Progress reported the storms caused flooding and lodged crops, creating uncertainty about final corn and soybean yields. Those problems are becoming increasingly important as combines begin moving into fields. USDA's latest Crop Progress report showed the nation's corn harvest reached 5% by Sept. 6, ahead of the five-year average. At the same time, the national corn condition rating fell to its lowest level of the season. Soybean development remains ahead of its normal pace, potentially allowing harvest to accelerate quickly if weather cooperates. The combination of heat, flooding and deteriorating crop ratings has increased uncertainty about final yields. More definitive estimates are expected when USDA releases updated production forecasts Friday.

Thursday Watch List

Markets

On Thursday, the Energy Information Administration will be out with their delayed Petroleum Status report at 9:30 a.m. CDT. Otherwise, it is a thin schedule for reports with the trade likely to remain subdued ahead of Friday's USDA updates.

Weather

A front has slipped to the southern end of the Corn Belt on Thursday and areas of scattered showers and thunderstorms continue from last night. Pockets of heavy rain are causing some areas of flooding as well. The front will not move much, making for some training thunderstorms that could produce more heavy rain throughout the day. It is much milder, but still above normal north of the front.