Corn prices are staging their biggest August rally since 2010, at a time of year when prices don’t typically see this kind of strength. Two veteran market analysts say $6 corn could be here before the end of year. But what about $7 corn? One analyst puts that at a 50/50 chance.
Dan Basse, founder and president of AgResource Company, and Chip Nellinger, founder and partner of Blue Reef Agri-Marketing, says when you look at the explosive run in grain markets, it’s being driven by shrinking U.S. yield prospects, tightening global supplies and rising geopolitical risk out of the Black Sea. But what would it take to reach $7? That’s where El Niño could come into play.
A Global Supply Problem, Not Just a U.S. One
The rally isn’t only about what Pro Farmer Crop Tour scouts found — or didn’t find — in the eastern Corn Belt last week. According to Dan Basse, it’s about a world that’s losing bushels on multiple fronts at once.
“It’s concerns about the U.S. crop, but then it’s concern about the international market,” Basse says. “World wheat production among major exporters is down 47 million metric tons from last year, he says, while corn production is down another 50 million metric tons. “So in the background, the U.S. crop is shrinking and stocks are coming in in domestic standpoint, but the global market with what’s going on in the Black Sea is really the problem.”
What Yield Is the Market Pricing In?
USDA currently has the national corn yield pegged at 180.7 bu. per acre. That yield estimate was released in the August WASDE, and didn’t include any objective yield sampling. But Pro Farmer Crop Tour uncovered a major problem in the field, showing production issues in key I-states, specifically Illinois and Indiana. That led to Pro Farmer to release their own annual yield estimate, and this year, was a big surprise, with Pro Farmer’s estimate coming in at 173.2 bu. per acre.
While funds had already been buying, that sparked new interest and sent corn higher on an unexpected rally. Harvest typically bringing seasonal price pressure, which makes this year’s rally is unusual. Nellinger says the market is already leaning toward a much smaller crop than USDA’s official numbers currently show.
“I really think the market’s trying to factor in somewhere around a 177 [bu. per acre] crop yield right now,” Nellinger says. All eyes are now on USDA’s September 11 report, he says, where the agency’s next move could determine whether the rally has more room to run.
If USDA comes in at 177 bushels an acre or lower, Nellinger says, the market could start pricing in further cuts down the road, moving closer to Pro Farmer’s tour-based estimate. But a smaller, half-bushel trim could take some steam out of the rally. “It’s really hard to rally the market straight through harvest, not impossible,” he says.
Adding to the volatility: comments from Russian President Vladimir Putin midweek suggesting a possible escalation in the Ukraine conflict sent wheat limit-up. “That adds another wrinkle in the whole equation,” Nellinger says.
From $6 Corn to $7 Corn: Here’s What It Would Take
Basse and Nellinger first floated $6 corn on the show roughly six weeks ago. That Facebook reel went viral. But today, that call looks increasingly likely, and Basse says there may be a real path to $7.
“I still think we’ll see $6 corn before the end of the year, but I also believe there’s a 50-50 chance we could see $7 corn if there’s any hiccups in Latin America,” Basse says, pointing to a possible timeline of late this year into the first quarter of next year.
Basse points to record-warm conditions in the equatorial Pacific tied to a potential super El Niño, and the uncertainty that creates for South American weather.
“If there is any issues at all, this corn market will not stop. The march will continue, and we get to real demand rationing... around $7,” he says.
Nellinger agrees the scenario is plausible, but not imminent.
“Under Dan’s assumptions of, you know, some sort of a problem in the southern hemisphere, particularly Brazil due to El Niño, absolutely,” he says. “Is that going to come by October 15th? Probably not.”
He also cautions producers to brace for turbulence along the way this fall.
“Daily ranges are expanding. We are well in overbought territory,” Nellinger says. “There’s going to be corrections along the way here that are going to likely be violent and hard to sit through.” He adds that fund positioning has accelerated the pace of these swings dramatically. “What takes, you know, moves that used to take three months now take... a matter of 10 days,” he says. “I think $6-plus corn is where we need to go based on what we know today. And that’s going to change rapidly.”
What Could Spook the Funds?
There’s risk to any market, especially a market that has funds have been pushing price higher. Ag Bull Trading reporting that as of late August 2026, managed money holds a net long position of 376,513 corn contracts, while their outright gross long position has reached an all-time record of 465,500 contracts
So, what could spook the funds? Beyond weather, Basse points to China as a wildcard heading into a September 24 summit with President Trump.
“There’s always something called China, right?” Basse says.
He notes China was notably left out of recent U.S. sanctions tied to Iran — “a tip of the hat economically to the Chinese,” he says — while Chinese buyers continue purchasing U.S. soybeans and roughly 2 million metric tons of corn out of Brazil.
“So if you look at the shipping line, it tells me that China also has a need for corn,” Basse says.
He wouldn’t rule out China extending some additional goodwill purchases of wheat or corn ahead of the summit, which could support prices even more.
For now, all roads lead back to USDA’s September 11 report, which is the next major data point that will tell traders whether $6 corn is a floor, and whether $7 corn moves from possibility to probability.
