Corn producers: Finish old-crop, advance new crop sales... Futures surged to contract and multi-year highs as the prospects for the U.S. crop are well below previously expected. A shortfall in production leads to concerns on demand, leading to higher volatility, so actively taking advantage of higher prices is prudent. We advise producers to sell 10% of old-crop stocks. You should now be 100% sold on 2025 production. We advise cash-only marketers to sell 20% of expected 2026 production, bringing total sales to 70% forward sold. We advise hedgers to cover the remaining half of the $4.80 puts (20% of production), which closed at 9¢ for a 23¢ loss. We also advise hedgers to sell 20% of expected production to get to 60% forward sold. We will look to add additional coverage via put options in the coming weeks to establish a floor on a portion of unsold crops.
Soybean producers: Advance new-crop sales... Soybean futures ran into stiff resistance at the July highs as production prospects look promising despite the challenges the corn crop has faced throughout the growing season. Demand remains somewhat contingent on U.S.-China relations despite persistent record crush use. We advise cash only marketers to sell another 20% of new-crop soybeans, bringing total coverage to 75% sold. We advise hedgers to sell the $11.60 puts covering 40% of production, which closed at 8 3/4 cents for a 51 1/4¢ loss. We also advise hedgers to sell 30% of expected production to get to 65% sold. We will look at covering additional production via put options in the coming weeks.
Check our advice monitor at ProFarmer.com for updates to our marketing plan.
Treasury Secretary Scott Bessent announced Monday that the U.S. was sanctioning more than 60 entities, individuals and vessels around the world that have enabled Iran to procure nuclear and missile technology, conduct cyber operations and generate oil revenue. “Let there be no ambiguity as to the position of the United States: An economic engagement of any kind with this murderous regime will expose those responsible to the full reach of American power,” Bessent said.
But a sense of ambiguity nonetheless lingered, particularly around China, which is the destination for around 90% of Iran’s oil exports. The Wall Street Journal noted that while the U.S. blockade of Iran’s ports and commerce may mean that China isn’t currently buying much Iranian crude, Chinese banks and other entities are still involved in repatriating revenues to Tehran. At the same time, Trump has made improved U.S.-China relations a top priority. And, of course, there’s what the White House has said is a commitment by China to buy 25 million metric tons of U.S. soybeans per calendar year along with $17 billion in other agricultural goods. China has been a steady buyer of soybeans in recent weeks and Chinese leader Xi Jinping is set to visit the U.S. next month.
Ahead of the US measures on Monday, China vowed to protect its “legitimate interests” and called for “reason and restraint on the Iran situation,” the South China Morning Post reported. “China will closely watch the developments and do what is necessary to protect its legitimate rights and interests,” Chinese Foreign Ministry spokesperson Lin Jian said.
- Also, the U.S. is preparing to impose a 7.5% tariff on Chinese goods over allegations of excessive manufacturing capacity before next month’s Trump-Xi summit, Bloomberg reported. The move would restore Trump’s second-term duties on China to around 20%, a level Beijing has described as consistent with the trade truce agreed to by Trump and Xi in October of last year.
Market recap: It was a volatile day in the grain markets. December corn gapped higher Sunday night after Pro Farmer’s 2026 corn estimate predicted a 15.344 billion bushel crop on a yield of 173.2 bushels per acre – around 10 bushels below trend and below USDA’s August estimate of 180.7 bushels. Soybeans slumped, with pressure in the complex led by soybean oil futures. The Pro Farmer estimate also calls for a soybean crop of 4.572 billion bushels based on an average yield of 53.3 bushels per acre, slightly above USDA’s forecast.
- December corn finished with a gain of 7 cents at $5.15 ½, near the daily low after hitting a contract high early on.
- November soybeans lost 15 ¼ cents to end at $12.24 ¼. September soybean meal rose $2.60 to $320.30, while September soybean oil dropped 222 points to 67.13 cents, hitting a six-week low.
- September soft red winter wheat rose ¼ cent to $6.81 ¾.
- December cotton rose 48 points to 88.83 cents, ending at a contract high close.
- October live cattle dropped $4.325 to $213.60, while November feeders dropped $5.275 to finish at $310.975 – an eight-month low for both. USDA on Monday announced plans for further re-openings of ports on the U.S.-Mexico border following the scheduled reopening of a Douglas, Ariz., facility (see item below).
- October lean-hog futures rose 25 cents to close at $81.125.
Condition update: The portion of the U.S. corn crop rated “good” or “excellent” as of Sunday fell to 57%, USDA said Monday, down three percentage points from the previous week and the third straight weekly decline. The portion of the soybean crop rated good or excellent fell by one percentage point to 60%, also a third straight decline. For a full rundown of U.S. crop conditions and the latest Pro Farmer Crop Condition Index readings, click here.
USDA to reopen 2 New Mexico ports to Mexican cattle: USDA Secretary Brooke Rollins on Monday said the U.S. would reopen two additional ports to cattle shipments from Mexico in 30-day increments after imports restarted at an Arizona port. The port in Douglas resumed trade Monday after being halted for most of the last year due to New World Screwworm. The reopening went ahead despite a screwworm case detected over the border in the Mexican state of Sonora last week. Rollins said in a news conference Monday that a second port in New Mexico will reopen in 30 days, Bloomberg reported, followed by a third port 30 days after that. The report noted that USDA had previously said it would consider reopening ports in Santa Teresa and Columbus in New Mexico but didn’t provide a timeline, while Rollins didn’t specify which of the New Mexico ports would reopen first.
UAW rejects Deere contract extension: United Auto Workers members voted down an offer of a two-year contract extension from Deere & Co., signaling the potential for rocky negotiations for a new contract. Deere last month offered union members 4% wage increases and $3,000 bonuses if they accepted the offer by the end of this month, the Wall Street Journal reported. It would have extended the current contract from its scheduled expiration in 2027 to 2029. Deere said pensions, healthcare coverage, cost-of-living wage adjustments and other benefits in the 2021 contract would have remained unchanged under the extension. UAW President Shawn Fain called the offer an attempt to avoid the regular collective bargaining process and failed to address the outsourcing of work from unionized plants and didn’t include a plan to call 1,600 laid-off employees back to work, the report said.
Tornado alley moving east: The peak of tornado season may be in the rearview mirror, but the eastward expansion of what has been traditionally known as Tornado Alley into more populated areas may continue raising insurance risk for some time, Insurance Journal reported. Record tornado activity in Illinois, Indiana, and Wisconsin this year drove elevated claims and increasing risk because of population exposure. The phenomenon also has implications for agriculture in the eastern Corn Belt. The report noted that other perils like severe thunderstorms and hail seem to have been moving to where they are more frequent in the east in recent years, as part of a broader trend. An Allianz report found that hailstorms drove record insured damages as severe convective storms become more common and damaging, popping up in new places.
- “Now we see very similar trends in hail as we do tornadoes with the eastward shift, and so it’s not just a single peril, tornado, that’s shifting,” Tory Farney, vice president of Verisk Weather Solutions told Insurance Journal. “It’s everything that kind of comes with severe thunderstorms. So, it’s hail, it’s wind, it’s instances of flash flooding that are sometimes associated with that — it’s kind of all of those threats, all kind of moving in the same way with that increased frequency more eastward.”