Soybeans and soft red winter wheat were lower again Wednesday with corn and hard red winter wheat ended higher.
Soybeans Make New Lows For the Move
Soybean futures made new lows for the move again on Wednesday. January and March contracts filled gap areas on Tuesday and closed below those areas which led to follow through selling on Wednesday. Naomi Blohm with Total Farm Marketing says soybeans have also confirmed the head and shoulders top and are working lower completing the shoulder.
How Much Lower Will Soybeans Fall?
However, Blohm doesn’t think the market has too much farther to fall before finding end user buying as it is down more than a dollar from the highs hit Nov. 18. ""I would think with this huge sell -off we’ve had and with the value of the U .S. dollar being lower, that China’s going to come in and finish up some of the buying that they need. The reality is that China does need to buy about two months of their needs from the United States to get that year-round supply. So this is China’s cue. It’s their opportunity,” she says.
China Needs U.S. Soybeans
Blohm says at the end of the day China needs to buy U.S. soybeans. “And so I do think that they will finish up the 12 million metric tons that they said that they were going to buy. The question is, how aggressive do they get beyond that, if anything? I think that they’ll show up. I think that they’ll commit to the full amount of the 12 million metric tons. It’s just the question of beyond that, do they actually do the 25 million metric tons that they were talking about or not?”
Biofuels News Also Bearish
EPA has also confirmed they will be delaying their final Renewable Fuels Standard Renewable Volume Obligations for 2026 and 2027 until 1Q of 2026 which has been bearish for soybeans, soybean oil and corn. However, Blohm says the soybean market is still seeing record crush. “The demand numbers for the domestic crush are still going to carry us into the first part of 2026,” she adds.
Seasonal Tendency for Soybeans
Soybeans also have a seasonal tendency to rally at the end of the year and so that could also signal a low is close in the market. Blohm says, “There is that seasonal tendency also that soybean prices can grind higher into the end of the year. Last year, the soybean market found a low on December 19th. And then from December 19th until New Year’s rallied just over 60 cents. So be ready for anything.”
South American Weather Watch
The market is just starting to watch the South American weather forecast to see if it gives China an even bigger reason to buy U.S. soybeans. So far there have been no major weather issues. “Weather in South America continues to be good enough for right now,” she says.
Funds Done Liquidating?
The managed money or hedge funds got much longer in the soybean market than expected in reaction to the China soybean purchase announcement. At the high of just under $11.70 hit in the January contract on Nov. 18 the funds were long 230,000 contracts of futures and options, just under the record of 260,000 long. It is thought since then they have been taking profits on that position, so are they done liquidating? “They definitely took some pretty big profits off the table over the last few weeks with the market price going lower. And now we’re going to see if they just sit on positions where they’re at right now until the end of the year, or is there going to be something fundamentally friendly that comes along that causes them to try to then grow their long position or not?” She says that will be dependent on the fundamentals, including what China buys and South American weather.
Record Export Demand Fails to Rally Corn
The corn market has continued to see record export sales and inspections are nearly 70% ahead of a year ago. However, the market remains stuck in a 15 cent trading range. What can change that? Blohm says the January WASDE. “That’s what gets us out of this. So what we need to see on that report is if the USDA lowers the yield, like we’re all thinking it needs to come down a little bit more. We think that the export number probably needs to come up a little bit more for the demand aspect. Biofuels for ethanol probably stays the same. And of course, the question is the feed number in terms of corn demand for feed. we’re all thinking that that number needs to come down.”
Can Corn Ending Stocks Get Below 2 Billion Bushels?
But can USDA get ending stocks for corn below 2 billion bushels? What kind of yield cut would it take? She says USDA needs to get closer to 182 bu. per acre to get the market excited, which she thinks is possible. “We didn’t have the most perfect growing conditions this summer, we still had a lot of issues with disease,” she explains. If we come in below 182 than the market will really get excited.
Global Corn Ending Stocks Leave No Room for Error
She says the corn market will also be watching South American weather. “Because there cannot be any other, any at all weather hiccups in South American production for corn, for their first crop corn, and even for their second crop corn. because global carryout for corn is actually trending lower. It’s the lowest in a decade. So there can be no room for error in South American production.”
Wheat Hits New Lows
Chicago or soft red winter wheat hit new contract lows again on Wednesday while hard red winter wheat was slightly higher on spread activity. Blohm says the wheat market was lower on Wednesday with China canceling 4.85 million bu. of soft red winter wheat among and large global supplies. “Wheat was down on news that China had bought wheat from Argentina, and they hadn’t done that in a long time. So that weighed on the market,” she says. However, wheat export sales are still ahead of USDA projections and the recent pullback in the U.S. dollar will make the U.S. even more competitive.
Deal or No Deal?
The wheat market has also been depressed with the crude oil market in anticipation of a peace deal between Russia and Ukraine. “We’re still trying to figure out the Russia and Ukraine truce or treaty or peace negotiations. So with U.S.
wheat being cheap, with the U .S. marketplace being able to deliver on time with a quality product, I think you’re going to see more U .S. export sales for wheat coming up in the next couple weeks.”
Will Trade Aid Slow Sales Early in 2026?
Usually farmer selling picks up after the first of a new year in an effort to generate cash for planting and in an effort to average income. However, she says that trend could change this year with the bridge payments USDA will be disseminating at the end of February. “Sme farmers might say, well, show me a really big price for grains before I get excited about making cash sales. So it could lead to farmers delaying decisions. So I would encourage a producer with the bridge payment, definitely helpful, but you still have grain in your bin that you need to price. So make sure that you’re watching these markets and marketing opportunities.” She says the seasonal would suggest oftentimes the winter high can come between that second week of January into the second week of February and producers should position themselves to take advantage of that rally.
