# Agricultural Markets

> Agricultural markets cover grains, oilseeds, softs and livestock. Learn the main contracts, the USDA reports that move them, weather, seasonality and trade policy.

Source: https://learn.tradelabsai.com/commodities/agricultural-markets/  
Track: Commodities · Level: Intermediate · Updated: 2026-10-03  
Publisher: TradeLabs AI (https://tradelabsai.com). Education, not financial advice.  
Cite as: TradeLabs Learn, "Agricultural Markets", https://learn.tradelabsai.com/commodities/agricultural-markets/

Agricultural commodities feed the world and supply raw materials for biofuels, textiles and industry. Their prices depend on weather, planting decisions, global trade, government policy and the slow cycle of growing seasons. Agricultural futures are some of the oldest exchange traded contracts: grain futures have traded in Chicago since the mid 1800s. Today, the main venues are CBOT (part of CME), ICE US and markets in Brazil, China, Europe and elsewhere.

## Categories

| Category | Main contracts | Exchange | Lesson |
|---|---|---|---|
| Grains | Corn, wheat (Chicago SRW, Kansas City HRW), oats, rough rice | CBOT | [Corn](https://learn.tradelabsai.com/commodities/corn/), [Wheat](https://learn.tradelabsai.com/commodities/wheat/) |
| Oilseeds | Soybeans, soybean meal, soybean oil, canola | CBOT, ICE | [Soybeans](https://learn.tradelabsai.com/commodities/soybeans/) |
| Softs | Coffee, sugar, cocoa, cotton, orange juice | ICE US | [Coffee](https://learn.tradelabsai.com/commodities/coffee/), [Sugar](https://learn.tradelabsai.com/commodities/sugar/) |
| Livestock | Live cattle, feeder cattle, lean hogs | CME | |
| Dairy | Class III milk, cheese, butter | CME | |

## What moves agricultural prices

| Driver | Example |
|---|---|
| Weather | Droughts, floods, frosts and heat waves during key growth stages |
| Planted acreage | Farmers' choices between crops based on expected profits |
| Yields | Crop condition and technology |
| Global trade | Exports from the US, Brazil, Argentina, Black Sea region, Australia |
| Government policy | Biofuel mandates, export bans, tariffs, subsidies |
| Currencies | A strong US dollar makes US crops less competitive; a weak Brazilian real encourages Brazilian exports |
| Energy prices | Fuel and fertiliser costs; ethanol and biodiesel demand |
| Livestock demand | Feed demand for corn and soybean meal |

## Key reports

The US Department of Agriculture (USDA) publishes reports that frequently move markets.

| Report | What it shows | Timing |
|---|---|---|
| WASDE (World Agricultural Supply and Demand Estimates) | Global supply, demand and ending stocks | Monthly |
| Prospective Plantings | Farmers' planting intentions | End of March |
| Acreage | Actual planted acres | End of June |
| Grain Stocks | US inventories | Quarterly |
| Crop Progress | Planting, condition and harvest progress | Weekly in season |
| Export Sales | Weekly export commitments | Weekly |

**Example: A report surprise**
Before the June Acreage report, analysts expect US farmers to plant 90.0 million acres of corn. The USDA reports 92.5 million acres, implying a larger crop if yields are normal. Corn futures fall the daily limit as traders revise supply estimates higher. A trader long corn into the report suffers a large loss, which shows why many reduce positions before major USDA releases. See [Trading Economic Releases](https://learn.tradelabsai.com/macro/trading-economic-releases/).

## Seasonality

Northern Hemisphere grain prices often carry weather premiums during planting and summer growing seasons, then face pressure from harvest supply in autumn. South American harvests, which run on the opposite calendar, increasingly influence global prices. See [Seasonality in Commodities](https://learn.tradelabsai.com/commodities/seasonality-in-commodities/).

## Daily price limits

Many agricultural futures have daily price limits: the maximum move allowed in a session. If a market hits its limit and stays there ("limit up" or "limit down"), trading can effectively stop at that price, making it hard to exit. Limits often expand after limit moves. See [Contract Specifications](https://learn.tradelabsai.com/futures/contract-specifications/).

## Who trades agricultural futures

- **Farmers** hedge future harvests by selling futures. See [Hedging](https://learn.tradelabsai.com/markets/hedging/).
- **Food companies, millers, feedlots and ethanol plants** hedge input costs.
- **Grain merchants** manage physical trade flows.
- **Funds and speculators** trade trends, weather and spreads.

## Risks

- **Weather shocks** that cause sudden moves.
- **Policy shocks:** for example, Russia's 2010 grain export ban or India's restrictions on rice and wheat exports.
- **Limit moves** that prevent exits.
- **Disease** in livestock, such as African swine fever affecting hog markets.

## Frequently asked questions

### What are agricultural commodities?

Farm products traded on futures markets, including grains, oilseeds, softs such as coffee and sugar, and livestock.

### What is the WASDE report?

The USDA's monthly World Agricultural Supply and Demand Estimates, which forecasts global production, use and inventories for major crops.

### Why are agricultural prices so sensitive to weather?

Because crops are grown once a season and supply cannot quickly adjust, so weather damage during key stages can significantly reduce production.

Next, study the largest US crop in [Corn](https://learn.tradelabsai.com/commodities/corn/).

## Sources

- USDA, [WASDE report](https://www.usda.gov/oce/commodity/wasde)

## Continue learning

- Next lesson: [Corn](https://learn.tradelabsai.com/commodities/corn/)
- Previous lesson: [Platinum and Palladium](https://learn.tradelabsai.com/commodities/platinum-and-palladium/)
- Related: [Platinum and Palladium](https://learn.tradelabsai.com/commodities/platinum-and-palladium/): Platinum and palladium are rare metals used mainly in car catalytic converters. Learn their concentrated supply, demand drivers, futures and big price swings.
- Related: [Corn](https://learn.tradelabsai.com/commodities/corn/): Corn is the largest US crop, used for feed, ethanol and exports. Learn corn futures, the crop calendar, USDA reports, key demand sources and what moves prices.
- Related: [Wheat](https://learn.tradelabsai.com/commodities/wheat/): Wheat is a global staple with several classes and many exporting countries. Learn Chicago and Kansas City wheat futures, the Black Sea's role and price drivers.
- Related: [Soybeans](https://learn.tradelabsai.com/commodities/soybeans/): Soybeans are crushed into meal for feed and oil for food and biofuels. Learn soybean futures, Brazil vs US supply, China's demand, the crush and key price drivers.
- Related: [Coffee](https://learn.tradelabsai.com/commodities/coffee/): Coffee futures track arabica and robusta beans grown mainly in Brazil and Vietnam. Learn the contracts, frost and drought risk, currency effects and price drivers.
- Related: [Sugar](https://learn.tradelabsai.com/commodities/sugar/): Sugar prices depend on Brazil's cane crop, India's policy, ethanol economics and weather. Learn sugar futures, the ethanol link, key producers and what moves prices.