By Mike Krueger*
The market turbulence continued into late summer and early fall. All the geo-political issues that dominated trade over the summer have continued.
There is still no end in sight to the Black Sea war. Both Russia and the Ukraine have stepped up attacks on grain vessels in the Black Sea, with more reports of damage and sinking of ships. Drone attacks are also continuing against port facilities.
The Iran war also seems far from over. The Strait of Hormuz is still a contested waterway. The Houthis are still disrupting shipping through the Red Sea. Crude oil prices have been hovering in the mid-$90/barrel range.
Markets had a bearish September despite all the bullish external news. The impact of high energy prices on the corn market has diminished as another huge U.S. corn harvest is under way. Soybean prices have slumped on what has been perceived as a “slow” soybean purchase pace by China.
Brazil’s farmers have started to plant another crop following three record crops in a row. Brazil produced 186 million metric tons (MMT) of soybeans in 2026, 180 MMTs in 2025 and 172 MMTs in 2024. Those big numbers are the result of increasing acres and good weather.
U.S. wheat markets have yet to show any signs of expanding despite all the shipping-related problems in the Black Sea. The USDA reduced the U.S. wheat export forecast in the October WASDE (supply and demand) report.
The USDA released two bearish series of reports within 10 days. The September 30 quarterly stocks report showed a much larger-than-expected September 1 corn stocks estimate. The number was 175 million bushels above expectations. That was bearish. The quarterly soybean and wheat numbers were within the range of estimates.
The next bearish report was the October 9 WASDE report. USDA raised the average U.S. corn yield by 2.7 bu/ac from the September estimate. Corn production was increased by 234 million bushels. That increase, coupled with the 175 million-bushel increase in September stocks, resulted in an increase in the corn supply of more than 400 million bushels. That is bearish.
Analysts are skeptical of the increased USDA corn yield estimate. All of the increased yield projections came in the Western Corn Belt (particularly Nebraska) where summer temperatures were setting records. The USDA raised the Nebraska corn yield estimate a whopping 11 bu/ac from the September guess. Their reason was that harvest yields were better, but less than 15% of the Nebraska crop had been harvested as of the report date.
The USDA also increased the U.S. soybean yield by 0.3 bu/ac to a new record. There is also skepticism in the market around the soybean yield estimate. Pod counts in several key states haven’t matched with higher yield estimates.
USDA released its first sunflower production estimate on October 9. They do not break the numbers down between oil and nonoil until later in the marketing year; for now, they estimated total 2026 sunflower production at 2,304,735 million pounds, down slightly from last year. A small yield decline offset a small acreage increase.
USDA projected the sunflower yield at 1,761 lbs/ac, down just 100 lbs/ac from last year. That’s very good, considering weather the last half of the growing season wasn’t ideal.
Sunflower stocks as of September 1 were up nearly 50% from a year ago. We had a big crop in 2025. Prices have held firm despite the larger carry-in supplies and the expected good 2026 crop.
The bearish market tone created by the succession of bearish USDA reports will be tough to change, at least until the corn and soybean harvests are finished. The speculative trading funds that were long much of the summer have exited those long positions and are now leaning to the short side of the market. They will need a reason to change direction.
It will take a fresh surge in export demand, barring any unexpected bullish changes by the USDA in their next reports. The world has become accustomed to the various conflicts. At the end of the day, none of these logistical problems have impacted actual deliveries or changed buying patterns as much as once expected.
The U.S soybean situation remains very tight even with the record yield estimate. The domestic soybean crush continues to set records. Corn supplies are bigger than expected, but demand is strong and the latest corn yield estimate is questionable.
Wheat simply needs demand. U.S. supplies are not burdensome, especially spring wheat.
* Mike Krueger founded The Money Farm, and is now a senior analyst with World Perspectives, a Washington, D.C.-based consulting company. While the information in this article is believed to be reliable, marketing involves risk, and the author and The Sunflower assume no responsibility for its use.