Fundamentally Speaking

On January 13, the May 2026 corn futures contract made a low near $4.25 per bushel, its lowest price since August 15, 2025.

Both times the market traded at these lows linked to some bearish USDA data, primarily record-high U.S. corn output last year as detailed in the first and last USDA crop production reports.

Since the January 13 low, the May contract pushed as high as $4.74.

Continued robust export demand and ideas that the Iranian war is bullish for renewable fuels profitability, which has enhanced values of both soybean oil (biodiesel) and corn (ethanol), along with the sentiment that skyrocketing fertilizer prices will result in less corn planted this spring than thought (and maybe less fertilizer application), would tend to dampen yield performance.

The 41-cent gain in May corn futures as of last Friday's close from the January 13 settlement can also be attributed to rather heavy fund buying as the speculative crowd has once again become enamored with the grain and oilseeds complex amidst the rise in crude oil values and the concomitant fall in the equities markets.

This chart shows the net fund position in corn with both futures and options on the left-hand axis vs. the price of spot corn in dollars per bushel on the right-hand axis.

The net fund position as of January 13 2 was -81,774 contracts but this past Friday's Commitment of Traders report had the funds now long 228,804 contracts, a net change of plus 310,578 contracts. This is the largest fund long position in corn since the end of February 2025, and the largest two-month net higher move in the corn fund long since late October 2020.

The correlation coefficients indicate over the past year net fund movement is certainly an influential factor in corn pricing.

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