Higher corn stocks push prices lower

KANSAS CITY, Mo. — The U.S. Department of Agriculture’s quarterly stocks reports are known for their surprises — and the Sept. 30 estimates did not disappoint.

Higher than expected marketing year-end corn stocks pushed prices below the $5 mark for the first time since Aug. 24 and price pressure continued through week’s end.

Mike Castle, StoneX Financial senior commodities economist, joined Arlan Suderman, StoneX chief commodities economist, in a webinar after the quarterly grain stocks and small grains summary report were released Sept. 30.

Why was the corn portion of the quarterly grain stocks report the headline-maker?

Castle: Everyone was caught off-guard by this. Corn stocks were pegged at 2.095 billion bushels, getting back above that psychological 2 billion bushel mark. This was the largest Sept. 1 corn stocks in seven years.

Pre-report trade estimates ranged from the top end of 2.005. StoneX was at 1.919 billion bushels corn carryout, in line with average trade estimate of 1.918 billion.

How big of a change is it that soybean stocks came in at 315 million bushels, 9 million below trade expectations, and wheat stocks, at 1.846 billion bushels, was lower than the average trade guess of 1.872 billion?

Castle: Compared to that massive miss on the corn side, those don’t look like major changes by any means.

Quarterly wheat stocks on Sept. 1 are at a three-year low. This is the tightest stocks since 2023 when we had a very similar year with a big drought across the Plains, there was weaker production in general.

That three-year comparison is going to be pretty relevant. The biggest drops across the Plains were where a lot of the worse weather conditions were.

Did you expect USDA’s quarterly stocks report to also include revisions to the corn crop for the 2025 growing season, decreasing U.S. production from nearly 17.021 billion bushels to about 16.964 billion?

Castle: We expected to see some downward revisions to last year’s production. It was a record crop at 17 billion bushels for the first time and an all-time yield at 186.5. The yield was left alone. USDA did not acknowledge that problem.

They did shave off some, but overall the U.S. corn crop was only cut by 57 million bushels. At the same time, there’s that 230 million bushel reduction on the demand side that leads to that net 170 million bushel increase in stocks that puts us at the 2.095 billion. It was certainly a lot more bearish than what was expected.

USDA’s 2026 small grains summary was overshadowed by the corn piece of the quarterly stocks. What were among the key numbers in the small grains report?

Castle: All in all, it was not necessarily a huge surprise. All wheat production, at 1.534 billion bushels, was slightly above but not far off of expectations of 1.524 billion or USDA’s August number of 1.531 billion.

Winter wheat production was bigger than expected at 1.02 billion — the average trade estimate was 988 million — and spring wheat was 20 million bushels smaller than expected at 450 million bushels.

This is not necessarily a major market-mover by any means, but the bigger focus continues to be on what’s happening elsewhere around the world, particularly in the Black Sea. The question for the U.S. balance sheet is how does that impact our export demand later in the year.