The corn markets treaded water early in the week before sinking following Fridays USDA report that increased production and carryout of the 2026/27 crop. December corn ended the week 18 cents lower while March and May futures each lost 17 cents. The funds have reduced their long position in corn by over 70,000 contracts since the first of October and ended the week long 236,839 corn contracts and long 220,066 soybean contracts.

Fridays USDA report projected the 2026/27 yield at 181.2 bushels per acre which was at the top end of pre report estimates and 2.7 bushels per acre higher than the September report. The 173 million increase to beginning stocks based on the September 30^th Grain Stocks Report along with this week’s increase in yield results in a carryout of 1.849 billion bushels. The 1.849-billion-bushel carryout represents a 11.34% stock to use ratio which historically results in CBOT values in the $4.25 – $4.50 range.

Globally, 2026/27 ending stocks were raised by 8.3 MMT to 280.44 MMT, below the average pre-report estimate but within the range (273.0 to 310.5 range). This reflects an increase in beginning stocks for the United States and Argentina and increased production in the United States.

USDA 2026 US Yield (Bushels per acre)

USDA 2026 US Production (Billion Bushels)

USDA 2026/27 US Carryout (Billion Bushels)

USDA 2026/27 World Carryout (Million Tonnes)

Harvest progress was limited in last week’s report with 23% of the crop reported complete compared to 27% on average. Weather was favorable across most of the Midwest last week which should result in better progress in this afternoon’s report.

Where do prices go from here? Following the bearish news from the last couple reports I look for the markets to stabilize. Lower prices should support demand both domestically and on the export front. We are still early in the harvest stages of the 2026 crop, but it wont be long before producers will be making 2027 planting decisions. The job of the market is to ration supply and demand. When comparing fall of 2027 values corn holds a small advantage but has lost a lot of ground recently. Any additional selling could swing that pendulum. With current demand, we need corn acreage and yield to hold constant which should add support to the corn market long term.

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The markets reversed direction following the bearish WASDE report last week. December, March and May futures all ended the week 30 cents lower on the week. The funds ended reduced their long position by 128,000 contracts and are now long 299,220 corn contracts while they remain long 232,558 soybean contracts.

The markets saw massive selling following the stocks report on Wednesday as the USDA confirmed it had been overestimating the 2025/26 feed demand. The average estimate for the September 1 stocks number was 1.918 million bushels. What the USDA delivered was 2.095-million-bushel carryout which came about through a combination of a slightly lower production number and ultimately a smaller feed demand number.

The 2.095 carryout offer a supply buffer to the 2026/27 supply and demand table. This adjustment is equivalent to adding almost 2 bushels per acre to the 2026 crop. Instead of a 178.5 yield that the USDA gave us back in August, technically just became greater than 180.

On Friday October 9^th the USDA will release its October crop production report. While not a lot of changes are expected, one that could surface is an adjustment to expected yield. Early reports from the southern states have reported yields below last year and in some cases by as much as 20 or more bushels. Will we see an adjustment lower or will the USDA surprise the majority with a higher yield. The only estimate available at the time of this writing was from well-known Stone X, whose estimates for this year’s crop come at 182.1 bushel per acre.

Harvest progress slowed last week and came in at 18% complete which is right in line with the five-year average. With excessive rains across the Midwest this past week, this afternoon’s report should show progress falling behind the average.

Historically the markets trend lower heading into October before slowly grinding higher into the end of the year. We filled the $5.09 CZ26 gap this past week and closed below multiple support levels to end the week. Look for the markets to stabilize heading into Friday’s report. Any significant adjustments on Friday could carry through until the November 10^th crop production report.

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Corn traded in a 20-cent range last week but ultimately settled unchanged to a penny higher in most contract months. Weather across the Midwest, China and US meetings along with rumors of peace in Iran kept traders’ attention during the week. The funds ended the week long 428,097 corn and long 277,159 soybean contracts.

President Trump and Chinese President Xi’s meeting had traders’ attention late last week. Following the conclusion of the meeting, there was no immediate mention of the 17-billion-dollar Ag purchase and no discussion of the 25 million metric ton soybean deal which sent the markets lower Thursday evening into Friday mornings trade. Fridays mid – morning comments from President Trump that the meeting was “very productive” and the US farmer would be “very happy” with the agreement caused the markets to rebound and trade back to unchanged to slightly higher to end the day. US Trade Representative Jamieson Greer stated Friday morning that the US and China have reached agreements on a subset of goods they can trade and that details of the agreement were going to be released on Monday September 28^th.

Late last week Iran offered to reopen the Strait of Hormuz and resume talks on its nuclear program within seven days if the United States lifts its naval blockade of Iranian ports, waives sanctions on Iranian oil sales and observes a ceasefire that would include Lebanon. These comments pushed crude oil $4-5/barrel lower to end the week. On Saturday President Trump said that he had rejected the Iranian proposal to reopen the Straight stating that they wanted to make a deal where they open the straight immediately because they’re losing so badly.

On Wednesday September 30^th the USDA will release its quarterly stocks report.  Estimates for the report are listed below.

USDA September 1^st Stocks (Billion Bushels)

Harvest progress remained slightly ahead of the five-year average at 13% complete last week. Yields continue to be reported in a wide range, but most of them are 10-20 bushels off last year’s results.

Historically the markets trend lower heading into October before slowly grinding higher into the end of the year. With the geopolitical influences and events, we have taking place today, I expect a lot more volatility and would look to capture both high and low that the market offers. Demand has been strong, but high prices have made the US less competitive over the last 30 days, and it is showing in export sales which is the first place it shows up.

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Corn struggled to maintain positive trade last week as traders monitor harvest reports and position ahead of the upcoming Trump/Xi summit. December corn ended the week 3 cents lower while March and May ended the week 4 and 5 cents lower respectively. The funds closed the week long 393,460 corn and 229,001 soybean contracts.

Early yield reports coming out of the Midwest are variable, which isn’t creating confidence in a bigger crop. Historically early yield reports often come from the lower-yielding ground due to any number of issues that may have brought the crop to early maturity. Harvest has slowed in the western corn belt due to heavy rains. The Midwest will see active rains over the next several days but nothing that will affect the yield at this stage.

President Trump and Chinese President Xi Jinping’s expected Sept. 24 summit in Washington is shaping up around reciprocal tariff reductions and an extension of the trade truce. China’s Commerce Ministry has confirmed negotiations on tariff relief covering $30 billion of goods from each country. For U.S. agriculture, the implications extend beyond another purchase announcement as lower Chinese duties could make American commodities more competitive with Brazilian supplies and create a pathway for Chinese commercial firms to re-enter the U.S. ag market.

Harvest progress remained slightly ahead of the five-year average at 8% completed last week. Expect things to be slower in the next two weeks as rain hampered progress across most of the mid-west.

While early yield reports are coming in all over the place, most of them are below last year’s records. This could add support to the markets long term if demand remains strong. Harvest pressure should keep things in check over the next 30-45 days. As I stated last week, there is a gap in the charts at $5.09 in the December contract that remains intact. I don’t know how quickly it will happen, but I do expect to fill the gap before coming back to current or higher levels.

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Corn closed lower for the first time in five weeks following a USDA report that was in line with expectations.

December and March corn ended the week 6 cents lower while May closed 7 cents lower on the week. The funds ended the week long 412,459 corn contracts and long 245,258 soybean contracts.

The September WASDE report released on Friday was in line with trade estimates resulting in spec traders taking profits. The national yield fell 2.2 bushels/acre to 178.5 due to larger yield reductions in the western states. (ND, SD, NE, CO and KS) On the demand side, exports were left unchanged, but Feed and residual use decreased by 150 million bushels to 5.950 billion bushels. Net-ending stocks were down 86 million bushels and are currently projected at 1.567 billion bushels.

USDA 2025/26 US Carryout (Billion Bushels)

USDA 2026 US Harvested Acreage (Million Acres)

USDA 2026 US Yield (Bushels per Acre)

USDA 2026 US Production (Billion Bushels)

USDA 2026/27 US Carryout (Billion Bushels)

Harvest progress came in ahead of both last year and the five-year average. Look for harvest progress to push north in the coming weeks as favorable weather pushes the crop to the finish line.

With harvest pressure building, the funds extreme length and another USDA report a couple weeks out, I am looking for some weakness in the markets. (Provided we don’t see geopolitical support) There is a gap in the charts from 3 eeks ago that remains intact. If this market is going to remain supported or move higher, we are going to need more fund support. Setting the markets back 20-25 cents would allow the funds to make some profits and allow others to buy back in. I don’t know how quickly it will happen, but I do expect CZ26 to fill the gap at $5.09 before coming back to current or higher levels. Remember my stat from last weeks letter, “December corn futures have never posted a high in September.” The USDA’s latest estimate puts the stocks to use ratio at 9.7% which is supportive of $5.50 CBOT prices.

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