With limited fundamental news to move the markets it was a quiet week of trading until news broke on Friday of the Supreme Court’s ruling on President Trumps tariffs. The May and July contracts ended the week 2 cents lower while the December contract was unchanged. The funds ended the week short 40,313 corn contracts and long 148,981 soybean contracts.

On Friday, The Supreme Court released its ruling on President Trump’s tariff policy. The ruling was against the President in a 6 to 3 vote. The case before the court was over the usage of the IEEPA (International Emergency Economic Powers Act). The court not only ruled on the IEEPA but also ventured its opinion on tariffs used by any President. Essentially, the case was decided against IEEPA only, but with a modest warning against the President on grabbing powers beyond what was stated as his. The President has several other items at his disposal to levy tariffs on countries to accomplish his goals, but the loss of IEEPA does change his leverage against some key players, such as China. It is estimated that without IEEPA, leverage against China falls by about 2/3.

The President issued a speech following the Courts ruling that he is planning to use the Safeguard tariffs and the Unfair foreign practices tariffs to carry out his goals. Both of these Acts are legitimate and could be implemented immediately if he so chooses.  The markets may see an initial move higher as investors reassess supply chains, pricing structures, and global trade flows with the tariffs lifted, but volatility could remain elevated as the White House evaluates its next steps and potential alternative trade actions.

On Wednesday the World Ag Outlook board released their projections for the 2026 crop. The data they released is mainly used for budgetary projections as most of the numbers are estimates and not tied to surveys and physical data like the USDA uses in their WASDE reports. The board estimated corn planted acreage at 94.0 million which is down from 98.8 million in 2025. Corn yields were estimated at 183.0 bushels per acre, which is down from last year’s 186.5 bushels per acre. Production came in at 15.755 billion bushels and ending stocks at 1.837 billion bushels. Historically the only data from this report that the USDA uses is the yield number as it gives them a starting point for their May WASDE.

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I feel like we the markets have been reenacting the movie “Groundhogs Day” with Bill Murray where he wakes up every morning to repeat the same thing that happened the day before. The only difference in the markets is we are doing it week to week versus day to day. Over the last four weeks we have started out weaker only to rally at the end of the week with minimal gains. Like the previous week, last week’s rally was on the heels of strength in the soybean market. March futures ended the week 2 cents higher while May and July futures ended 3 and 5 cents higher. The funds end the week short 43,493 corn and long 115,396 soybean contracts.

On Tuesday the USDA released their February Crop Production report that gave us an update on demand and carryout figures for domestic and world balance sheets. The USDA raised domestic export projections by 100 million bushels to 3.3 billion bushels reflecting sales and shipments to date.  With no other changes noted to the domestic balance sheet, ending stocks were lowered by a similar amount to 2.127 billion bushels.  This was below both the average trade guess of 2.227 billion. The world balance sheet featured lower ending stocks with most of that coming from the U.S.  World-ending stocks were projected at 288.98 MMT, down 1.9 million from January and below the average trade estimate of 290.48 MMT.

USDA 2025/26 US Carryout (Billion Bushels)

USDA 2025/26 World Carryout (Million Tonnes)

USDA 2025/26 South American Production (Million Tonnes)

On Thursday Conab (Brazil’s version of USDA) updated its Brazilian corn crop estimate and lowered it .4 mmt to 138.5 mmt. They lowered their Safrihna (2nd crop) by 1.2 mmt to 109.3 mmt. The Safrihna crop isn’t even ¼ planted and Conab is trimming its potential. What is also interesting is that Conab has flipped its relationship with the USDA’s estimates. In the past, it was regularly a discount to USDA projections, and now it’s a premium and not just a small one.

This week we will get our first look at what the USDA is thinking on the 2026 crop. The World Agricultural Outlook Board meets February 19^th through the 20^th. This is an economic meeting where the USDA projects their supply and demand numbers for the next 10 years. The data that they will provide will be used for budgetary projections. The most important numbers the trade will be looking for are the trend yields. Normally, the trend yields they release in the forum are used in the May WASDE report when they make their first new crop projections for corn and soybeans.

Market attention will continue focus on harvest progress in South America, with production estimates still subject to change in coming reports pending field results from Brazil and Argentina.  Attention will also begin to shift towards the new-crop growing season in the U.S., with planting and field preparations already underway in Texas.

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The markets recovered from losses early in the week to close 2 cents higher in the March contract and 3 cents higher in the May and July contracts. Support from the soybean market on news of additional export business was the catalyst this past week. The funds ended the week short 42,613 corn contracts and long 131,153 soybean contracts.

President Trump’s Truth Social post on Wednesday following a phone call with Chinese leader Xi Jinping triggered a bullish response in the soybean market. Trump said he encouraged Xi to have China purchase more U.S. ag goods, including increasing 2025-26 soybean purchases from 12 million metric tons to 20 million metric tons. He also reiterated that China has committed to buy 25 million metric tons of U.S. soybeans for 2026-27. Following these comments the soybean market managed to rally 50+ cents in most of the old crop contract months. While this didn’t pull corn as much as I would normally anticipate, it did add strength and help raise the support levels in the corn charts.

The USDA will release their February Crop Production report on Tuesday. Estimates are listed below.

USDA 2025/26 US Carryout (Billion Bushels)

USDA 2025/26 World Carryout (Million Tonnes)

USDA 2025/26 South American Production (Million Tonnes)

Brazil soybean harvest is slightly behind last the five-year average while first crop corn harvest is about 5% behind the five-year average. Brazil’s second crop corn planting is 3 % behind the five-year average.

Weather in Brazil has been favorable with beneficial rains that will help soybeans but may slow some second crop corn planning. In Argentina, most of the corn and soybeans remain dry with limited rain in the short-term forecasts. The 7-day forecasts are calling for beneficial rain, but coverage is still uncertain.

The US acreage situation is what is at the forefront for the corn market right now. With the E15 situation unsettled, there is no bullish news on corn demand that wasn’t in place last year. For now, it’s up to the markets to persuade corn acres to bean acres to avoid oversupplies in 26/27.

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Corn had an up and down week of trade with the lack of fundamental news in the market. The announcement of the next chairman of the Federal Reserve and forecasts for wetter weather in Argentina pressured the markets to end the week. March, May and July corn all ended the week 2 cents lower. The funds ended the week short 74,596 corn and long 14,794 soybean contracts.

Late last week President Trump picked Kevin Warsh to be the next chairman of the Federal Reserve which resulted in some short-term pressure on the market. Following the announcement we immediately saw strengthening of the US dollar, driving grain prices lower. Expectations are for Warsh to be less aggressive on rate cuts which will make the dollar stronger and make US grains less competitive.

Argentine weather has become more of a concern as radar shows a crop that has declined in the vegetative index over the last month which is expected to impact the top end yield potential. Forecasts remain dry for the next week, but extended forecasts are calling for a return to normal rain in the two-week timeslot. Brazil on the other hand has had sufficient rainfall in the growing areas resulting in improved crop conditions.

The markets have rallied from the post WASDE low, but with no indications that supplies are going to tighten in the coming year it will struggle to test the upper pre-report levels. Historically the corn market rallies in February as the market tries to hold or buy acres heading into spring. There are no indications that it needs to keep acres this year. I have run projections using 94.8 million corn acres (down 4 million from 2025), 181 bushels per acre (down 5 bpa), decreasing feed use by 100 million bushels and increasing exports by 100 million bushels, we still have a 2026/27 carryout of 1.8 billion bushels. With stocks that plentiful we should not see an acreage battle in February, and we have plenty of room to support more demand before the market needs to react.

The extremely cold weather that we have experienced recently has had some short-term impacts on the markets that could linger all season. The extreme cold resulted in ethanol plants having to reduce rate by as much 50% due to natural gas curtailments. The reduced grind cannot be made up, which will add more bushels to the balance sheet. On the export side, there have been some major disruptions to the river systems as frozen conditions and low water levels on the Illinois, Ohio and Mississippi rivers have crippled barge logistics. Barges not being able to ship or shipping lower volumes due to low water leaves a lot of bushels that don’t make it to the export market that has been a strong buyer. Everyday that these shipments fall behind is one day closer to South American harvest. Gulf logistics that are tapped out and will not be able to make up for that business later as South American competition grows later in Q1 and Q2.

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It was a quiet week in the markets until Friday mornings export sales were released. March, May and July futures all ended the week 6 cents higher. The funds jumped in and bought 40,000+ contracts of corn on Friday ending the week short 64,367 corn contracts and long 23,624 soybean contracts.

A surprisingly large export sales report showed sales at 158 million bushels for the week with 50 million bushels to unknown destinations, 32 million to Japan and 30 million to South Korea. This was the largest single week for corn sales since March 2021. Last week’s sales increased the US pace to 3.46 billion bushels vs. the USDA’s forecast of 3.20 billion bushels.

Argentina crop conditions continue to deteriorate according to Buenos Aires Grain Exchange (BAGE) who is the premier organization in Argentina responsible for monitoring, analyzing and forecasting crop production. They updated their crop conditions last week and it continues to show a sharp fall out on conditions as dryness persists and heat moves in the coming week. They are still expecting a very good crop, but we are seeing the top end of production removed and may not see the extreme record that had been in play. This is important as the size of this crop drops the size of the US export program climbs.

The corn industry suffered a setback last week when the US House removed the Year Round E15 language from a funding bill. There was a lot of hope from the biofuel industry that this would slide through as part of a must-pass bill. A Year Round E15 waiver would clear the way for but not guarantee a major expansion of the E15 blend. Only 1.5% of the US fuel pumps are cleared to dispense E15 blends currently and most of them are in the Midwest. Estimates on how much corn demand would increase if E15 became available year-round range from 500 million to more than 2 billion bushels. An E15 expansion would take years to build infrastructure and consumer demand, but would support industry and producers

We have bounced about 40% off the low made following the January WASDE and could test the 50% mark this week. If weather continues to be negative in south America and exports remain strong we should have our lows in for the time being. I am not suggesting we cant move lower, but I look for things to stabilize in the $4.25 to $4.35 range for March futures for the next few weeks. The markets historically have a little rally in February, but it may be hard to rally much with a 2 billion plus carryout sitting on its back.

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