November 3 – Market Commentary

The Week in Three Numbers

3.34% - The spread between the current export pace and the pace needed to hit the USDA's October WASDE export projections, increased from 2.08% last week.

1,118 - The total ethanol production last week in thousand barrels per day, the largest production since April.

7 of 8 - The number of weeks December corn has closed lower since reaching its September peak, including five consecutive weekly declines.

The Market

Who wants to talk about the bears?!? Caleb Williams, am I right??

Unfortunately, talking about the Caleb Williams and the Chicago Bears would be significantly more fun. These Chicago bears are, well, less fun.

Corn hit its second straight bold red number and continued its demise for the fifth straight week and seventh in eight weeks since the peak. In a new trading month for soybeans, we immediately pulled off almost 35 cents and have lost ground in three straight weeks. Soybeans also have a new bold red, which, before the old one rolled off, wasn't a low. That will likely happen again this week unless the bears continue to eat the whole crop. Wheat found a new bold red for the fourth straight week and is close to posting double digits for consecutive weeks of losses. Live and feeder cattle are still holding strong with feeder cattle hitting its fourth straight bold green. In new trading months for crude, gasoline and diesel, crude and RBOB hit new bold reds, so did crude for the third straight week. All three - crude, gas and diesel - have current bold greens that wouldn't have been a high in the moment and will roll off together this week. Soybean oil hit a new bold red after trading within a small range of neither high nor low since the peak in late August. Meanwhile, the 10-year treasury took a small hit, the dollar index took a small jump, while the S&P 500 lost over 80 points, hitting a new bold red. The S&P hadn't dropped below 7,600 since mid-September and hadn't closed a week that low in significantly longer.

It takes a significant amount of squinting to find any sort of positivity in the row crop markets right now. Despite taking some marginal gains Monday morning, corn has struggled once again to open up on Tuesday - and there's not much for optimism in any of the reports I'm about to walk through. Soybeans haven't had it any better, down near $12 Tuesday morning after closing Monday at $12.04, and wheat has lost another 10 cents this morning.

Last week I mentioned there was some support just under $4.50 and that if we fell through that floor, we could be looking at the lowest December corn price of the year. Well, that analysis could very well prove prescient. Here's the one-year December corn chart.

That red line was the old level of support at $4.49. There could possibly be some support at the low $4.40s, but honestly? With the some of the demand indicators we'll look at and a November WASDE coming next week, I wouldn't count on support there.

Just for the fun (or lack thereof), let's look at the one-year charts for HRW and soybeans.

That wheat chart isn't very fun at all. There might be some support there in July at the low $6.30s but like corn, I'm not that optimistic. The one-year soybean chart does look a little more optimistic.

That circled area offers a much firmer level of support, unless the WASDE next week comes out bearish. Soybeans do have a much better demand picture, especially on exports. Weekly Export Sales data has current soybean export commitments at 28.778 MMT, which is about 80% higher than the same week last year, and already 62% of the USDA export projection. So, there is some optimism on the soybean side. That's in contrast to wheat, with commitments 29% lower than last year and 57% of USDA expectations, which is behind the 65% five-year average pace.

Corn had a second brutal week in exports. Sales were down 15% from the previous week but were at least up 32% from the four-week average. Unfortunately, sales aren't really the problem, though we are at only 28% of the USDA's projections. The issue is actual shipments.

At only 550 TMT sent out of the country last week, the lowest of the marketing year, the gap between current pace and where we need to be has widened again for the third straight week to 3.34%, up from last week's 2.08%. That is not a pretty picture heading into a new WASDE.

Further bearish news in demand came in the Grain Crushings and Co-Products report. Corn used for fuel alcohol was revised up in August, but September's numbers came down by 8.54%. That number tracks with our ethanol production reports. Beverage alcohol also lost 6% and industrial alcohol lost 1.73%. I guess none of us are drinking enough despite the bear market.

Looking at where the funds stand, HRW has a net short position for the first time in a while, which doesn't help the picture at all. Both corn and soybeans continued to see selling positions, with corn losing almost 50,000 long positions, and soybeans losing almost 60,000. Even still, corn is still net long, and over 87% of soybean positions are still long.

If we squint hard enough, there is some good news. Ethanol production picked up last week, topping 1.1 million barrels per day again, and tallying the largest production since April.

Based on this it's easy to see September's dip in corn used for fuel alcohol. I would guess when October's numbers for corn use come out next month, October will be above September and below August. It's also the fourth straight week of increasing production, going largely to fill strong ethanol export demand. The announcement of an agreement with Mexico to unlock their market to U.S. ethanol should help as well. If it's anywhere close to the $1.5 billion USDA claims it could be, exports could increase by almost a third, and you should see that production number increase.

The USDA's agricultural prices report for September also should give us some perspective. Despite having lost most of the gains, prices in September were 20% higher than last year in corn, 36% higher in wheat, 23% higher in soybeans and 28% higher in grain sorghum. The agricultural prices report for October likely won't be that optimistic, but hopefully everyone took advantage of those higher prices to lock in some profit, even if it didn't last.

With next week's WASDE report, I do want to revisit the balance sheet and maybe take an educated guess on what will come to fruition.

When speaking at AgCon 2026, former USDA Chief Economist Seth Meyer said that after October, from a report standpoint, supply is relatively locked in. So, let's assume the November report won't change stocks, yield or production. I'm also going to leave imports and feed/residual static as well.

The demand side is where there becomes some real question. Let's bump up food, seed and residual slightly on cheaper corn, we'll increase ethanol by 100 just for the sake of the argument, given strong ethanol exports, production and the Mexico framework. However, I estimate a roughly 5% cut to exports given the gap, though, admittedly, that's probably quite aggressive this early in the game.

Those changes, shown in the bolded numbers on the far right, bring potential ending stocks for next week's WASDE up above 2 billion bushels, and increases the stocks-to-use ratio to almost 12.5%. And that is the formula for how you get the lowest December corn price of the year.

Because I want to end on a positive note, soil moisture levels in Kansas continue to improve.

We put two more percentage points in the adequate-to-surplus levels in topsoil and three percentage points in the subsoil levels.

The Week Ahead

It's almost like the calm before the storm in the first week of November - if an election week can ever be described as calm. Next week is laden with reports, including that November WASDE. The export sales report on Thursday should give further indication of whether I'm on the right track with my balance sheet prediction.

Other than that, get out and vote, and stay safe!