Insight Focus
China uncertainty is outweighing a supportive WASDE for corn. Lack of Chinese commitment and weaker soybeans dragged corn lower, despite a clearly supportive May WASDE, while wheat still managed to end the week positive. Trump’s announcement of a 17 billion USD Chinese purchase commitment may offer some support, but we see no reason for Chicago corn to consolidate above USD 4.5/bushel.
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Lack of Chinese commitment weighs more than a supportive May WASDE, and corn was dragged down by soybeans. Wheat managed to close the week positive.
The WASDE was definitely supportive last week, especially for wheat but also for corn too. We do think the corn S&D is being conservative on corn usage for ethanol, and we could see even lower stocks. All the support in corn came on the back of lower year-on-year yields, which is likely due to the impact of fertilisers once normal weather resumes.
Over the weekend Trump announced that China committed to buy USD 17 billion worth of US agricultural products through 2028, on top of the 25 million tonnes/year of soybeans already in place since late 2025.
After last week’s sell-off, which was on the back of a lack of Chinese commitments, the weekend announcement by Trump should push the market back up given that we are heading to lower stocks in both corn and wheat. We do not think there are reasons for Chicago corn to consolidate above USD 4.5/bushel.
There are no changes to our forecast for Chicago corn to average USD 4.4/bushel during the 2025/26 (September/August) crop. The average price since September 1 is running at USD 4.36/bushel.
Corn Drops After Early WASDE Rally
The May WASDE published last Tuesday was supportive, which, together with worsening conditions of US winter wheat, resulted in a strong rally during the first half of the week. But Trump came back from China empty handed, and soybeans sold off during Thursday and Friday, dragging the whole grains complex down. The early week rally in wheat was enough to save the week, but corn couldn’t make it and closed the week with heavy losses.
The May WASDE reduced US corn stocks of the old crop by 14 million bushels, all coming from lower demand, and published the first estimate for the 2026–27 crop with ending stocks of 1.957 billion bushels, down from 2.14 billion bushels of the old crop.
Source: USDA
There was no surprise in acres, which came in at 95.3 million as in the Prospective Plantings report from March 31. But the USDA did project a yield of 183 bushels/acre, down from 186.5 bushels/acre of the old crop, factoring in some impact from lower fertiliser use. It also projects 100 million bushels less food and feed demand. All in all, the stock-to-use ratio projected for the new crop falls to 10.3% vs. 11.8% for the old crop.
Source: USDA
The first version of the global S&D projected a stock draw of 19 million tonnes, all coming from lower US production.
In Argentina, the Rosario Grain Exchange increased its corn production estimate to 68 million tonnes versus 67 million tonnes previously, which is in strong contradiction with BAGE’s estimate of 61 million tonnes. Conab in Brazil increased its corn production forecast to 140.2 million tonnes, or just +0.4% compared with its previous forecast. In Ukraine, the government forecast 31.6 million tonnes of corn production.
US corn is 57% planted, slightly behind last year’s 59% but ahead of the five-year average of 52%. In France, corn planting is 95% complete, above last year’s 88% and the five-year average of 85%, with crop conditions at 90% good or excellent compared to 88% a year ago.
Corn planting in Russia is 43% complete compared to 63.4% last year, and in Ukraine at 54.4% versus 72.6% last year. In Argentina, corn harvesting is 32% complete. In Brazil, summer corn harvesting has reached 71.5%, trailing both last year’s 77.6% and the five-year average of 74.8%.
Wheat Rally Holds Despite Late Selloff
Wheat’s early week rally was more substantial than in corn, given the fall in US wheat conditions and the sharp stock draw projected in the May WASDE. This rally was enough to maintain weekly gains despite the sell-off in the second half of the week.
The May WASDE reduced old crop ending stocks by an immaterial 3 million bushels but projected a heavy stock draw of 173 million bushels for the new crop, with carryout of 762 million bushels, down from 935 million bushels of the old crop.
Source: USDA
The lower acres were not a surprise, as they came from the March 31 Prospective Plantings report, but the low yield of 47.5 bushels/acre versus 53.3 bushels/acre of the old crop surprised the market, despite week-after-week deterioration in wheat conditions.
Source: USDA
World stocks for the new crop were projected at 275 million tonnes, implying a stock draw of 4 million tonnes.
The Ukrainian government forecast 22.4 million tonnes of wheat production.
US winter wheat is 28% in good or excellent condition, down three points week-on-week and well below last year’s 54%. French wheat stands at 80% good or excellent, unchanged on the week and higher than the 73% recorded last year. In Ukraine, spring wheat planting has reached 96.1%, slightly ahead of last year’s 93.5%. By contrast, progress in Russia is at 23.3% complete, compared with 37.3% last year. Wheat planting in Brazil is 17.5% complete, marginally behind both last year’s 18.4% and the five-year average of 18.9%.
A mix of dry weather in France and normal rain in Germany is expected in northwest Europe this week, while the Black Sea region is expected to be rainy. Brazil is expected to receive rain in the Centre and Centre-West, while drier weather is expected in the West. Argentina is expected to be dry and cold. US growing regions are expected to be dry and warm.
