The corn market had another uneventful week as traders wait for news of the government returning to work or a trade deal with China, neither of which are on the immediate radar. Corn ended the week 1 higher in the December contract while March and May finished unchanged. The funds are estimated to be short 82,323 corn and long 31,258 soybean contracts.
President Trump is expected to meet with President Xi this week on the 30th in South Korea at the APEC summit. I am not expecting anything big out of this meeting, but the fact that they are meeting has to be positive. Trump has stated he plans to focus on the illegal drug trade and Ag trade with Xi. China isn’t interested in corn imports from any origin let alone the US as they have enough local supplies to meet demand. The hope is that a deal may get done for soybeans which will add strength to the corn markets.
There is some optimism that the framework of a trade agreement has already been reached between the U.S. and China. Treasury Secretary Bessent was quoted on Face the Nation as saying he expected China to make “substantial” soybean purchases in the future. When talking with Face the Nation host Margaret Brennan, he was quoted as saying “Margaret, I’m not going to give you the details here, but I can tell you the soybean farmers are going to be extremely happy with this deal for this year and for the coming years.”
The Trump Administration has reopened the Phase 1 Deal investigation to determine whether China has complied with the original agreement. The Deal, which was orphaned under the Biden Administration, may be hard to enforce based on the legal language that was built into it.
I would estimate corn harvest to be 58% complete nationwide compared to my estimate of 45% last week and 65% last year. Harvest in the north is plodding along with reports of wetter corn, but good yields coming from our draw area. Basis has started to strengthen in Kansas, Ohio and central Illinois where the farmer has been reluctant to market his grain. Small movements in basis are encouraging sales with the lack of CBOT movement. I look for basis to remain flat in most areas of the US until we hit December when basis will have to do the work if the CBOT hasn’t shown any life.
Barring any negative news or canceled meeting between leaders, I look for the corn market to make a higher move this week and fill the gap created back in July at $4.3275 in the CZ25 contract. If we manage to fill this gap, $4.50 would be my next target.
Upcoming reports
| Date | Report |
| TBD | |
| *All reports are on hold. |
