The USDA’s latest Supply and Demand and Crop Production reports has provided fresh insights into the corn and cattle markets, with mixed reactions observed in both sectors. John Heinberg, Market Advisor at Total Farm Marketing, shared his analysis of the report’s impact on these key agricultural markets.
Corn Market
“The corn market reacted relatively neutrally to the report,” Heinberg stated. “We saw a slight reduction in harvested acres—about 70,000 acres—likely due to flooding in the Western Corn Belt. However, yields were adjusted upwards to 183.1 bushels per acre, which would be a record yield if it holds. Despite these changes, corn prices held steady, reflecting a market that had already priced in much of the negativity.”
The focus now shifts to the potential for a large corn crop. “Producers in key states are reporting what could be a bumper crop,” Heinberg said. “With ending stocks projected at 2.073 billion bushels, one of the largest since 2018, we’re facing a significant supply that could weigh on prices moving forward.”
Cattle Market
The cattle market, on the other hand, has experienced more volatility. “Cattle futures took a big hit last week, breaking through key barriers and triggering aggressive selling,” Heinberg explained. “Some of this was tied to broader market trends, including a washout in the stock market, but it was also driven by money flow moving out of high-value assets like cattle.”
Despite the recent downturn, Heinberg remains cautiously optimistic. “The fundamentals for cattle are still strong, but the market is shaky. We’re seeing softer cash prices and retail demand is uncertain. The cattle market could have more room to decline, but it’s going to be driven by what happens in the cash markets and consumer demand.”
