Disclaimer: This information has been taken from sources believed to be accurate, there’s a risk in trading futures and options, only risk capital should be used.
The beginning of spring finds farmers in states such as Indiana, Iowa and Illinois getting their 2026 corn planting underway. A typical pattern for corn prices would be for strength to build through planting season as traders’ anxiety ticks up over every planting delay or weather report. Then, once a premium has been built, planting progresses, anxiety eases and prices tend to weaken.
Corn prices have been under pressure for more than a year, with rallies repeatedly failing to hold. The market did see a normal lift heading into planting season, and the war added further fuel to that move. But as the fear premium begins to fade, the market looks to be returning to a more familiar battle between seasonal planting support and a much heavier supply.
Think of yourself sitting on the ground and The Rock sitting on your shoulders. Do you think you could stand up?
As option sellers, we are less concerned with picking the exact price a market will reach than with identifying price targets that would be difficult to reach. The corn market is offering conditions that we believe will make price rallies hard to sustain.
Why?
Two reasons
Huge yields led to a bumper crop that produced a hoard of excess supply. Sales of the 2025 crop have been steady, but not enough to clear the surplus. The March 31 Grains Stocks report shows 9.024 billion bushels of corn in U.S. storage; the largest amount ever recorded for that date. The USDA’s projected ending stocks for the 2025/26 marketing year sit at 2.127 billion bushels, the highest in seven years. That is a lot of corn hanging over this market.
A lot.
With planting season now underway, the early pace has been respectable. As of April 26, 25% of the U.S. corn crop had been planted, up 14 points from the week before and 6 points ahead of the five-year average. That still leaves a long way to go before the crop is made, but so far the market has had little reason to build much of a planting-weather premium into prices.
U.S. Corn Stocks Are at Record Highs
Effect on Corn Price
This has led corn prices not to rally in the usual spring fashion, but instead to remain under pressure from the weight of supply. Even the sharp rally tied to the Middle East tensions and fertilizer concerns faded quickly as the market turned its attention back to the domestic balance sheet. With old crop inventories this large, rallies have had a difficult time holding.
Bearish fundamentals getting more bearish
Those looking to buy corn at today’s lower price levels may want to think again. Corn fundamentals are not getting any better.
The U.S. is expected to plant 95.3 million acres of corn this year. That is below last year’s figure, but still enough to yield an impressive crop should average yields come to pass. And with old-crop stocks already sitting at record levels for March 31, it would not take a record crop to keep supplies burdensome.
Even average yields this year would leave the market with a great deal of corn. While daily prices will ebb and flow, we feel the corn market is unlikely to mount a significant longer-term rally with this kind of burdensome supply pressing down on it.
Think of yourself sitting on the ground and The Rock sitting on your shoulders. Do you think you could stand up? Maybe, but you are going to need one heck of a reason to do so.
Corn has that kind of supply on its shoulders right now, and we do not see a reason strong enough to counteract that weight any time soon.
Wild cards
The situation, of course, could change. There are two factors that could alter corn fundamentals either in favor of the bulls or the bears.
Weather: U.S. weather is always a factor in grain prices in the summer. While true weather events are surprisingly rare, they do happen occasionally. Corn will be most susceptible to adverse weather during pollination. This typically occurs in late July. A weather event could change the momentum to the bulls.
Fertilizer and the Strait of Hormuz: This year’s new wildcard is the fertilizer market. Tensions tied to the Strait of Hormuz have raised concerns about input costs and global fertilizer flows. If fertilizer prices remain elevated or move higher from here, some producers could reduce application rates and yields could suffer. On the other hand, many farmers had already booked needs ahead of the spike, and the planting pace so far has shown no major sign of disruption. It is worth watching closely, but for now it has not been enough to offset the burden of heavy supplies.
How to play it
With burdensome old-crop stocks on hand, a strong start to the growing season and projections for another big crop in 2026, supply-side fundamentals seem to be heavily in favor of the bears. A significant weather event this summer could change that, but there are no signs of such an event thus far. In reality, crop-damaging weather, while always a possibility, is uncommon.
The corn market is currently vulnerable to short-covering rallies and headline-driven moves, particularly if weather worries or fertilizer concerns intensify. But unless those concerns turn into a genuine supply problem, rallies may continue to face pressure from the market’s heavy supply backdrop.
A weather rally later in the summer, particularly during pollination, would be the kind of move traders and investors will want to watch closely in the December contract. Corn is most susceptible to weather during pollination in late July.
Justin Cardwell
Director of Research at OptionSpreaders.com
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