For the week May corn was up 6 ¾ cents, December corn gained 7, May soybeans soared 24 ½, November soybeans were up 14 ¾, May soybean meal was $5.50 per short ton higher, May soybean oil added 86 points, May soft red winter wheat lost 3, May hard red winter wheat was 6 ½ higher and May hard red spring wheat gained 2.
Grain markets were mostly higher for the week with soybeans leading the gains, despite increased volatility tied to the Iran war.
Jerry Gulke, president of the Gulke Group, says the strength was even more impressive considering the market absorbed massive farmer selling by those who had stored old crop grain and were finally able to reward the market on the rally.
“Corn futures absorbed the increase in farmer selling this week like it wasn’t there. The market even ignored news that elevators and ethanol plants bought so much that they have filled needs for next 60-90 days.That process is called “shaking the lose leaves off the tree,”
He says even the large speculative net position in corn has been decreasing since last October.
Paradigm Shift in Corn
Gulke says this is a result of the paradigm shift that has also taken place in the corn market.
Last week Gulke dove into the change in market outlook for soybeans from positive to negative 18 months ago, adding that he though Q1 of 2026 would be friendly.Soybeans are already in the process of breaking a four-year down trend and according to Gulke corn is setting up for the same type of technical action.
Corn Chart Shows a Breakout
The monthly continuous corn chart looks similar to last week’s soybean chart.
Gulke explains the uptrends in the early 2000’s were a result of the increase in ethanol production and demand, which resulted in corn topping out near $8 per bu.
“Price discovery then says, all right, we’ve got all these people now growing $8 corn. We’ve got too much, and the price went down to seek more demand and never really did go back.” That was followed by a seven-year demand building era trying to match demand with oversupply.
Gulke says the drought induced supply rally of 2011-2012 topped corn again near $8 proving that even Brazil would respond to price by adding corn, as well as soybean acres.“We finally got corn back up to a price that invited more competition out of Brazil. And that’s what high prices do. They invite competition,” he explains.
This brings us to today where the corn market has spent several years once again building demand, and that’s the process according to Gulke. “That’s how it works. If you want to fight against that, it’s a losing proposition.”
Corn Chart Shows Long Term Low Forged
The continuous corn chart, which monitors the front month, shows three distinct lows coinciding with August 31st he says. This includes the low made in August of 2024.
“That’s when we said there was a paradigm shift in agriculture ahead of even Trump getting elected and the tariffs being invoked. It is a global phenomenon that took place and we would have had a demand increase in corn and soybeans even without the tariffs,” he explains.
Last August, the corn market made another significant low, according to Gulke, and is now rallying off that low.
“Now we’re trying to break out above levels that were former support. You can see it on the chart. The media will tell you that’s all about oil, and it’s correlated with this and that. This started a long time ago,” he adds.
Outlook for Corn
Corn prices have rallied well off the August 12 low of $4.10. Gulke says producers who held grain in storage waiting for this kind of opportunity should be rewarding the market.
“Now I’ve got 40 to 50 cents a bushel more. You know, that’s $100 an acre on 200-bushel corn. Even if I told you it’s going to go to $7, you probably want to sell some because you don’t want to risk the whole farm. You risk it when it’s cheap and you can’t replace it for a new crop for that price, then you hold it. There’s a risk and reward, and now the time for taking a reward,” he explains.
However, Gulke’s longer term outlook for corn is bullish as demand continues strong, especially for with record exports and ethanol production.
“I have a feeling that China will probably become a corn buyer down the road a ways, and that may be next fall. They’re not going to buy high-priced stuff now perhaps, but we’ll see what comes out of the meeting in April.”
Gulke thinks China’s economy is faltering and with the U.S. now controlling more of the global oil supplies the U.S. has leverage.“So, we’re kind of holding a lever over their heads that’s going to help our grain prices help them buy from us.”
For more information contact Jerry at info@gulkegroup.com.
