09/01/2026

LATEST RECOMMENDATION:

On Aug. 28, 2026 — While I am generally not a fan of making grain sales over the late-summer and fall months, the historic nature of the rally through late August warrants special consideration. Although I remain optimistic of higher prices in 2027, the rally is driven heavily by geopolitics which can shift rapidly and with little warning. With that in mind consider another sale of 10% of 2026 production for delivery after the first of the new year. March 2027 corn futures are trading near $5.53 at the time of this recommendation, with $5 corn a rare occurrence over the past three years.  

DAILY NOTE:

December corn futures closed up 8 1/4 cents on Tuesday to $5.46 and March futures were up another 8 cents to $5.60 1/4. The corn market moved higher yet again on Tuesday, posting a ninth higher day out of the past 10. In fact, the December corn board has not posted back-to-back lower sessions since the second week of August. The market is considerably overbought from a technical standpoint but that has mattered very little to traders with no one wanting to be caught short given lower-crop ideas in the U.S., coupled with strong demand and international issues such as the standstill for exports out of the Black Sea. The trend in corn futures is considered higher for now, keeping in mind the possibility of a seasonally inspired harvest time selloff.

CURRENT ASSESSMENT:

The trend in corn futures is higher for now, with nearby prices staging an impressive counter-seasonal rally to three-year highs in August. In the August WASDE, USDA forecasted the second largest U.S. corn crop on record in 2026, and for the second year in a row notably increased acreage estimates. However, historically strong demand has begun to outpace supply leading to notable cuts to corn ending stocks for both the 2025-26 and 2026-27 seasons, with the ending stocks-to-use ratio for the upcoming year dropping to 10.1% — leaning bullish historically. In the annual DTN Digital Yield Tour, forecasts call for a 178.5 bushel per acre national yield, 2.2 bpa lower than USDA’s August forecast. The world corn situation continues to lean bullish as well with a poor European crop expected and uncertainty surrounding Ukraine’s ability as a supplier amid increased Black Sea port attacks through the late summer. Overall, the corn market has an increasing amount of bullish arguments at a time when seasonal lows tend to hit in August or September. For now, the corn market is a moderately bullish, Type 2 market.

RECOMMENDATIONS*

*NOTE REGARDING 2025-26 CROP SALES*: In December 2025, USDA offered details for Farmer Bridge Assistance payments, with corn producers receiving $44.36 per planted acre, or approximately $0.26 per bushel based on the 2025 national average corn yield of 186.5 bushels per harvested acre, and 92% national average for harvested area.

SUMMARY:

2025-26: 100% sold on 2025 corn production at an average price of $4.08.

2026-27: 60% sold in cash market at an average hedged price of $4.99 futures. 40% of 2026 production remains unsold/unhedged.

Detailed Positions:

2025-26:

2025-26: 100% sold on 2025 corn production at an average price of $4.08.

2026-27: 50% sold in cash market at an average hedged price of $4.88 December futures. 50% of 2026 production unsold/unhedged.

On May 19, 2026, sold the final 25% of old crop corn with the DTN National Cash Index near $4.36. Unwound previous put/call spread for a net cost of 3 cents. Net cash for the sale is $4.33. 2025 corn production is now 100% sold.

On April 30, 2026, sold 25% of the remaining old crop 2025 corn production, with the DTN National Cash Index near $4.28. Unwound previous put/call hedge on that portion of grain. 25% of 2025 corn production remains unsold in cash but is hedged by the remaining puts and calls.

2025-26: On March 20, 2026, hedged the remaining 50% of old crop 2025 corn production by buying July 2026 $4.70 puts and selling July 2026 $5.25 calls for a net cost of near 10 cents. 100% of 2025 corn production is hedged, while 50% remains unsold in the cash market.

2025-26: On March 4, 2026, sold 10% of 2025 corn production with May futures near $4.42 and the DTN National Corn Index likely near $4.03.

2025-26: 2025-26: Placed an order to sell the next 20% of 2025 corn production in cash for fall delivery when December futures hit $4.30. Simultaneously, placed an order to sell the remaining $4.20 December puts for 4 cents. Upon fills, net cash price should be near to $3.83 after previous option premiums are taken into account. FILLED ON 10/27. 60% of 2025-26 corn production unsold.

2025-26: Sold 20% of 2025 corn production in cash for harvest delivery on September 17, 2025, with December corn futures trading near $4.30, and the DTN National Corn Index near $3.88. Simultaneously unwind previous put/call hedge, sell $4.20 Dec puts near 8 1/2 cents and buy $4.75 Dec calls near 2 cents, for a net cost of 5 cents for the hedge. Leave put/call protection in place on 30% of production for now. Net cash for the sale should be near to $3.83.

2025-26: Hedged 50% of 2025-26 corn production on June 30, 2025 with a custom min/max strategy. Bought $4.20 Dec 2025 corn puts near 20 cents and sold $4.75 Dec 2025 corn calls near 8 1/2 cents for a net cost of near 11 1/2 cents.

2026-27:

On August 28, 2026, forward sold another 10% of new crop 2026 corn production for delivery in the January/February window with March 2027 futures trading near $5.53 1/2. 40% of 2026 production remains unsold/unhedged.

2026-27: On May 19, 2026, forward sold another 15% of new crop 2026 corn production for harvest delivery with December 2026 futures near $4.96. 50% of 2026 corn production remains unsold/unhedged at this time.

On April 30, 2026, forward sold another 10% of new crop 2026 corn production with December 2026 futures near $4.93. 65% of 2026 corn remains unsold and unhedged at this point.

2026-27: On March 20, 2026, forward sold another 15% of new crop 2026 corn production with December 2026 futures near $4.91. 75% of new crop 2026 corn remains unsold/unhedged at this point.

2026-27: On March 4, 2026, sold the first 10% of 2026 corn production with December 2026 corn futures near $4.68. 90% of 2026 corn is unsold at this point. 

*DTN recommendations are general in nature and are not intended to be specific for any particular person or farming business. The buying and selling of futures or options involves substantial risk and is not suitable for everyone. DTN accepts no responsibility for actual trades made.

TREND: The trend in most active corn futures is revised to higher for now.

NONCOMMERCIAL OUTLOOK: Noncommercial corn traders held a net-long futures position of 440,915 contracts as of Aug. 25, record length for late August. Traders were net-buyers of 138,773 contracts as bullish momentum picked up on lower U.S. yield forecasts as well as Black Sea grain supplies being cutoff by recent attacks against shipping infrastructure.  

COMMERCIAL OUTLOOK: Commercial corn traders held a net-short position of 374,608 contracts as of Aug. 25, and were net-sellers of 129,008 contracts through the CFTC reporting period. The December 2026 contract is priced 14 3/4 cents lower than the March 2027 contract, strengthening (less carry) through the week for the fourth straight week, and perhaps a sign of growing concern over new-crop corn supplies. National average corn basis firmed 3 cents through the past week to 49 cents under the December board. However, this is still the second weakest basis of the past decade for late August.

SEASONAL INDEX: Corn prices tend to peak in early June and bottom in early October.

PRICE PROBABILITY: The front-month (December) corn futures contract finished the most recent week at the 34th percentile, rising 6 points through the week to the highest ranking within the five-year range since April of 2025.

VOLATILITY: Three-month price volatility for the most active (December) corn contract jumped to 15% after prices traded sharply higher through the week for the third straight week, while closing outside the upper bound of the volatility implied price range ($5.32).