Dan Flynn is the writer of The Corn & Ethanol Report, a daily market letter covering grains, energies, and various global issues that are the driving force and backbone of the commodity markets. Contact Mr. Flynn at (312) 264-4374
We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Applications, MBA Mortgage Market Index, MBA Mortgage Refinance Index, and MBA Purchase Index at 6:00 A.M., Fed Barkin Speech at 6:30 A.M., EIA Energy Stocks at 9:30 A.M., 17-Week Bill Auction at 10:30 A.M., Fed Goolsbee Speech at 12:00 P.M., Fed Bostic Speech at 12:30 P.M., and Dairy Product Sales at 2:00 P.M.
The Consumer Price Index for July was at expectations at 325.05. This was a 0.3% increase in June and reflected an annualized inflation rate of 2.7%. The annualized inflation rate was unchanged from June and was 0.2% less than a year ago. However, the CPI set a record high in July. The CPI is notorious for understanding the lived experience of the average American. The proprietary index called the Consumer Essential Index which covers the base of the average family’s monthly budget: food, energy, shelter, clothing, utilities, car insurance, and healthcare. This index better reflects price impacts and family budget for working-class Americans. This index lagged the CPI during the 2020-2022 inflation surge, and has also been stickier as inflation rates have declined. The Consumer Essentials Index in July reflected a 3.2% annualized inflation rate vs. 4.5% a tear ago. Utility electric costs were up 6% from last year, medical care and shelter were each 4% higher while foof and car insurance rose 3% each. Energy costs were down 1% and clothing cost were unchanged. So far there is no indication of inflation.
Analysis of USDA’s August WASDE
USDA’s August WASDE leaned highly bearish of corn, slightly bearish of wheat and supportive of the soy complex – at least until the pace of US soy export demand is known in terms of Chinese demand for US soybeans. Ag Resources (ARC) sees the corn market as a bear, with the soybean market to become a demand bear `if China does not arrive soon to secure a massive amount of US October forward soybeans. Oversupply is ARC’s chief concern, and even in the soy complex prices will only encourage max seedings in Argentina/Brazil. Additionally, the US corn market’s goal is to shift 5-7 Mil US acres to soybeans in spring 2026. In the next 18 months, US corn and soybean end stocks will both be oversupplied. ARC highlights a US corn yield of 188+, a major crop production in 2025 will take up 92% of total storage capacity – a level not seen 2016 and only seen twice in the last two decades. Cash basis levels will work with futures to clear excess inventory. It’ll take time to work through the grain supplies forthcoming, and so its imperative to start 2026 soybean hedges on any further rally effort. Again, corn is a supply bear and soybeans look to become a demand bear market in the coming months.
Corn Analysis of USDA WASDE
August WASDE corn data was bearish! USDA revisions not only keep in place a bearish trend into mid-harvest but also set the stage for a prolonged period of deflated prices if South American weather adversity avoided. US harvested area raised 1.9 Mil acres – FSA enrollments as of Aug 1st totaled 96.5 Mil acres, 300,000 above USDA’s previous seedings number and yield was raised an incredible 7.8 BPA to 188.8. This fits well with historical relationships with crop ratings and vegetation indexes reflect the special nature of the 2025 growing season in places like KS, NE, IA, and WI where record yields across the C and S Plains will be well above recent years. NASS’s yield hikes from August to September were hiked and additional hikes are not guaranteed, but downward revisions of more than 2 BPA are rare in 11 of 14 years since 1990, yield in September was steady to higher. Be prepared for a final US yield for a final US yield of 186-192 BPA. Large supplies are locked in with normal Central US weather for the next 2-3 weeks. Corn prices must fall in price to attract even larger demand to come close to validating record export/domestic demand projections. Total US corn supplies in 25/26 are projected at 18.07 Bil Bu. USDA’s build in end stocks was countered by residual, industrial and export demand – much of which ARC sees as being unfounded. It will be challenging to export more than 2.5 Bil Bu without a comprehensive US-Chinese trade deal amid record large American & Ukrainian production. The risk into early 2026 is that WASDE reports trim total consumption and lift projected end stocks to 2.4-2.8 Bil Bu`. This dampens a post-harvest rally. ARC’s work suggests there’s downside potential to $3.40-$3.60, basis Dec, between now and late September. Either a Chines deal or a massive change in yield perception is needed to provide stability at current prices. Note that amid the addition of harvested acres, a final yield below 180 is needed to pull 24/25 end stocks below 2 Bil Bu. Also, 2026-27 corn stocks stay above 2.4 Bil Bu with normal weather – even if 6 Mil planted acres are lost. Oversupply looms for the next 18 months with corn in a supply bear market. December corn will find strong resistance at $3.98-$4.08 with harvest lows not expected until October.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com
Marget Digests WASDE Bearish Corn Data, Traders Wonder When Fed Will Wake Up. The Corn & Ethanol Report 08/13/2025
We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Applications, MBA Mortgage Market Index, MBA Mortgage Refinance Index, and MBA Purchase Index at 6:00 A.M., Fed Barkin Speech at 6:30 A.M., EIA Energy Stocks at 9:30 A.M., 17-Week Bill Auction at 10:30 A.M., Fed Goolsbee Speech at 12:00 P.M., Fed Bostic Speech at 12:30 P.M., and Dairy Product Sales at 2:00 P.M.
The Consumer Price Index for July was at expectations at 325.05. This was a 0.3% increase in June and reflected an annualized inflation rate of 2.7%. The annualized inflation rate was unchanged from June and was 0.2% less than a year ago. However, the CPI set a record high in July. The CPI is notorious for understanding the lived experience of the average American. The proprietary index called the Consumer Essential Index which covers the base of the average family’s monthly budget: food, energy, shelter, clothing, utilities, car insurance, and healthcare. This index better reflects price impacts and family budget for working-class Americans. This index lagged the CPI during the 2020-2022 inflation surge, and has also been stickier as inflation rates have declined. The Consumer Essentials Index in July reflected a 3.2% annualized inflation rate vs. 4.5% a tear ago. Utility electric costs were up 6% from last year, medical care and shelter were each 4% higher while foof and car insurance rose 3% each. Energy costs were down 1% and clothing cost were unchanged. So far there is no indication of inflation.
Analysis of USDA’s August WASDE
USDA’s August WASDE leaned highly bearish of corn, slightly bearish of wheat and supportive of the soy complex – at least until the pace of US soy export demand is known in terms of Chinese demand for US soybeans. Ag Resources (ARC) sees the corn market as a bear, with the soybean market to become a demand bear `if China does not arrive soon to secure a massive amount of US October forward soybeans. Oversupply is ARC’s chief concern, and even in the soy complex prices will only encourage max seedings in Argentina/Brazil. Additionally, the US corn market’s goal is to shift 5-7 Mil US acres to soybeans in spring 2026. In the next 18 months, US corn and soybean end stocks will both be oversupplied. ARC highlights a US corn yield of 188+, a major crop production in 2025 will take up 92% of total storage capacity – a level not seen 2016 and only seen twice in the last two decades. Cash basis levels will work with futures to clear excess inventory. It’ll take time to work through the grain supplies forthcoming, and so its imperative to start 2026 soybean hedges on any further rally effort. Again, corn is a supply bear and soybeans look to become a demand bear market in the coming months.
Corn Analysis of USDA WASDE
August WASDE corn data was bearish! USDA revisions not only keep in place a bearish trend into mid-harvest but also set the stage for a prolonged period of deflated prices if South American weather adversity avoided. US harvested area raised 1.9 Mil acres – FSA enrollments as of Aug 1st totaled 96.5 Mil acres, 300,000 above USDA’s previous seedings number and yield was raised an incredible 7.8 BPA to 188.8. This fits well with historical relationships with crop ratings and vegetation indexes reflect the special nature of the 2025 growing season in places like KS, NE, IA, and WI where record yields across the C and S Plains will be well above recent years. NASS’s yield hikes from August to September were hiked and additional hikes are not guaranteed, but downward revisions of more than 2 BPA are rare in 11 of 14 years since 1990, yield in September was steady to higher. Be prepared for a final US yield for a final US yield of 186-192 BPA. Large supplies are locked in with normal Central US weather for the next 2-3 weeks. Corn prices must fall in price to attract even larger demand to come close to validating record export/domestic demand projections. Total US corn supplies in 25/26 are projected at 18.07 Bil Bu. USDA’s build in end stocks was countered by residual, industrial and export demand – much of which ARC sees as being unfounded. It will be challenging to export more than 2.5 Bil Bu without a comprehensive US-Chinese trade deal amid record large American & Ukrainian production. The risk into early 2026 is that WASDE reports trim total consumption and lift projected end stocks to 2.4-2.8 Bil Bu`. This dampens a post-harvest rally. ARC’s work suggests there’s downside potential to $3.40-$3.60, basis Dec, between now and late September. Either a Chines deal or a massive change in yield perception is needed to provide stability at current prices. Note that amid the addition of harvested acres, a final yield below 180 is needed to pull 24/25 end stocks below 2 Bil Bu. Also, 2026-27 corn stocks stay above 2.4 Bil Bu with normal weather – even if 6 Mil planted acres are lost. Oversupply looms for the next 18 months with corn in a supply bear market. December corn will find strong resistance at $3.98-$4.08 with harvest lows not expected until October.
Have A Great Trading Day!
Contact me directly with any questions or open a trading account at 1-888-264-5665 or dflynn@pricegroup.com
Thanks,
Dan Flynn
Questions? Ask Dan Flynn today at 312-264-4374