Hope for a ceasefire in the war is dashed, Chicago grains rebound along with oil prices

⑴ On Thursday, Chicago corn, wheat, and soybean futures regained lost ground alongside crude oil prices, as Trump stated during a televised speech that there would be a fierce strike on Iran in the next two to three weeks, dashing investors' hopes that the war with Iran would soon end. Peak Trading Research noted that there are no signs of the conflict easing in the short term, and that supply shocks in crude oil and their transmission to the agricultural market remain robust.⑵ As of 18:22 Beijing time, the main CBOT soybean contract rose 0.3% to $11.7275 per bushel, wheat increased 1.6% to $6.0675, and corn climbed 0.7% to $4.5725, rebounding from Wednesday's three-week lows. However, a significant rise in the US Dollar Index limited the gains, making grains more expensive for overseas buyers.⑶ During wartime, grain prices have largely moved in tandem with crude oil fluctuations, reflecting both the use of corn and soybean oil in biofuels, and the knock-on impact of rising energy and fertilizer prices on crop production. Analysts at Rabobank pointed out that the market is partially pricing in the scenario where higher fertilizer prices cause farmers to reduce inputs, thus decreasing yield per acre and driving up prices to maintain profitability.⑷ The US Department of Agriculture stated on Tuesday that by 2026, US farmers plan to reduce corn acreage and increase soybean planting. Analysts expect that fertilizer and fuel costs will prompt more acreage to shift from corn to soybeans, while the wheat market is also assessing the impact of drought in the US Plains.