A Barrage of Headlines, but Still a Friendly Story
Jul 28, 2026
Zack Gardner
Grain Marketing & Origination Specialist
The past two weeks corn and soybeans have been on quite the tare higher. From July first, corn rallied $0.56 and soybeans rallied $1.13 before taking a step back last week. The rally has mostly been driven by funds buying all commodities as the war with Iran reignites, as well as the Russia/Ukraine war, and on top of all that, the Houthi rebels (backed by Iran) have started threatening and attacking ships in the Red Sea! This has funds wanting to be long commodities in general. The Middle East is mainly a driver of crude oil, which soybean oil follows. The escalation between Russia and Ukraine has big implications on the wheat and corn that gets exported from them. And then lastly, China has started buying U.S. new crop soybeans, which tightens our new crop soybean carryout. All in all, there’s no reason for the funds to not be long commodities! Until this past weekend’s headlines…
Headline #1 - On Friday, July 24th, Ukraine proposed a compromise solution for allowing grain to continue to move through the Black Sea, which takes away some fundamental support for wheat and corn.
Headline #2 - On Friday, July 24th, the Trump administration imposed a new tariff plan as the previous (Section 122) tariffs expired. This new one is 10-12.5 percent under section 301, based on a country’s use of forced labor. China was assessed at 12.5 percent, which brings the total tariff to an effective 22.2 percent. Tariffs have been a big sticking point for China, and they did grumble over the weekend about that increase in tariffs, which might threaten additional soy exports to them.
Headline #3 - On Saturday, July 25th, the USDA announced a phased reopening of the southern border for cattle, which sent livestock lower. It also might imply less corn exports to Mexico next year if we are feeding them here.
Headline #4 - On Sunday, July 26th, President Trump mentioned a pause in bombing Iran, which sent crude oil significantly lower.
Headline #5 - Lastly, the forecast on Sunday, July 26th, shifted from hot and dry to cooler, with some moisture. The Euro model, which is more accurate 90 percent of the time, actually showed more moisture than the GFS weather model for the western corn belt.
Now, before we get too bearish from the barrage of headlines that hit us over the weekend, let’s take a step back and look at fundamentals. Russia and Ukraine continue to attack each other, threatening their grain exports. Considering the corn rally we’ve had, we haven’t picked up any export business from this escalation. Both Russia and Ukraine’s money-machines are exporting commodities, so they should both continue to do so to the best of their abilities to keep funding their sides of the war. So, what could be driving this corn rally? I think it might be hot and dry conditions in the U.S. Since mid-July, corn crop conditions have dropped 5 percent, down to 63 percent good-to-excellent.
In my opinion, it is hard to hit trendline, when we are 10 percent below last year’s corn ratings and on par with the 5-year average of 63 percent. I think we are due for a downward adjustment to the U.S. corn yield on the August USDA report! I’m not calling for anything crazy, as we are still on par with the 5-year average, but something in the 181 or 182 bushels per acre range wouldn’t be out of line; and if that happens with our record corn export program already, we could see some fireworks. That could take us to a sub-10 percent stocks-to-use ratio, which is bullish.
Grain Marketing & Origination Specialist
The past two weeks corn and soybeans have been on quite the tare higher. From July first, corn rallied $0.56 and soybeans rallied $1.13 before taking a step back last week. The rally has mostly been driven by funds buying all commodities as the war with Iran reignites, as well as the Russia/Ukraine war, and on top of all that, the Houthi rebels (backed by Iran) have started threatening and attacking ships in the Red Sea! This has funds wanting to be long commodities in general. The Middle East is mainly a driver of crude oil, which soybean oil follows. The escalation between Russia and Ukraine has big implications on the wheat and corn that gets exported from them. And then lastly, China has started buying U.S. new crop soybeans, which tightens our new crop soybean carryout. All in all, there’s no reason for the funds to not be long commodities! Until this past weekend’s headlines…
Headline #1 - On Friday, July 24th, Ukraine proposed a compromise solution for allowing grain to continue to move through the Black Sea, which takes away some fundamental support for wheat and corn.
Headline #2 - On Friday, July 24th, the Trump administration imposed a new tariff plan as the previous (Section 122) tariffs expired. This new one is 10-12.5 percent under section 301, based on a country’s use of forced labor. China was assessed at 12.5 percent, which brings the total tariff to an effective 22.2 percent. Tariffs have been a big sticking point for China, and they did grumble over the weekend about that increase in tariffs, which might threaten additional soy exports to them.
Headline #3 - On Saturday, July 25th, the USDA announced a phased reopening of the southern border for cattle, which sent livestock lower. It also might imply less corn exports to Mexico next year if we are feeding them here.
Headline #4 - On Sunday, July 26th, President Trump mentioned a pause in bombing Iran, which sent crude oil significantly lower.
Headline #5 - Lastly, the forecast on Sunday, July 26th, shifted from hot and dry to cooler, with some moisture. The Euro model, which is more accurate 90 percent of the time, actually showed more moisture than the GFS weather model for the western corn belt.
Now, before we get too bearish from the barrage of headlines that hit us over the weekend, let’s take a step back and look at fundamentals. Russia and Ukraine continue to attack each other, threatening their grain exports. Considering the corn rally we’ve had, we haven’t picked up any export business from this escalation. Both Russia and Ukraine’s money-machines are exporting commodities, so they should both continue to do so to the best of their abilities to keep funding their sides of the war. So, what could be driving this corn rally? I think it might be hot and dry conditions in the U.S. Since mid-July, corn crop conditions have dropped 5 percent, down to 63 percent good-to-excellent.
In my opinion, it is hard to hit trendline, when we are 10 percent below last year’s corn ratings and on par with the 5-year average of 63 percent. I think we are due for a downward adjustment to the U.S. corn yield on the August USDA report! I’m not calling for anything crazy, as we are still on par with the 5-year average, but something in the 181 or 182 bushels per acre range wouldn’t be out of line; and if that happens with our record corn export program already, we could see some fireworks. That could take us to a sub-10 percent stocks-to-use ratio, which is bullish.