Technically Speaking

Rhett Montgomery
DTN Lead Analyst

Following the Trump administration's 90-day tariff pause on April 9, new-crop corn futures exploded for a week-long rally, which saw the December board cover over 20 cents of ground. Through the remainder of April, however, prices retreated back toward the early April lows as traders continued to be troubled by what the USDA estimate of 95.3 million corn acres and thus far timely planting pace could potentially mean for corn supplies in 2025-26.

There are some technical features that may signal optimism for harvest prices from this point. First, while the March 6 close of $4.41 3/4 was the second lowest of 2025 thus far (ahead of Jan. 3's $4.40 3/4 close), prices held above $4.40. Thus far through 2025, December futures have traded below this mark in just four sessions and are yet to post a close below the level, implying traders are still viewing those price breaks as good buying opportunities. Another noteworthy observation is that in the past 31 years, the December corn contract has never hit its calendar year high in February, where 2025's current high of $4.79 3/4 was established on Feb. 20.

Over that same time period, December futures have also never set their calendar year low in March, as it currently stands for 2025. If support at $4.40 fails, the next likely bearish target for the trade would be near $4.28, the low from early December 2024. The May 12 USDA balance sheet for the 2025-26 marketing year will offer a big clue into summer price direction, which will ultimately be dictated by growing season weather conditions. Over the past five years, USDA has averaged an ending stocks-to-use forecast of 14% in their first round of new-crop estimates. Averaging out the subsequent December contract lows for those years gives a mark just above $4.50. This is a crude exercise and imperfect science, but assuming USDA sticks with its February Outlook forecast of 13% ending stocks to use for 2025-26, this may suggest the current lows near $4.40 futures are very near to the floor for harvest prices.

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Comments above are for educational purposes only and are not meant as specific trade recommendations. The buying and selling of commodities, futures or options involve substantial risk and are not suitable for everyone.

Rhett Montgomery can be reached at rhett.montgomery@dtn.com

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