Commodity Markets

When we think of July what’ s the first thing that comes to mind? Many will likely respond“ fireworks on the 4th,” though I lost interest in that celebration many years ago. Others will say lemonade and ice cream, both homemade to provide a break from the summer heat.

When it comes to grain markets, however, July tends to see the U. S. hard red winter( HRW) wheat harvest reach its peak leading to a seasonal selloff by the National HRW Wheat Index( national average cash price) that tends to extend through late August. Speaking of which, a look ahead to next month,( known as the dog days of summer), and we see U. S. soybeans taking center stage. But this month belongs to the King of the Grains Sector based on the old saying,“ Corn is made in July.”

Old-Crop Closes, New Begins

By the time you read this, the old-crop July futures contract will have moved into delivery, officially closing the book on interest in this past year’ s supply and demand. Traders, both long-term investment and hedging interests, will have turned their attention to new-crop, and given grain markets are weather derivatives at heart, the spotlight will be on July’ s weather. Now, I’ m not a meteorologist, but I’ ll make the forecast( confidently I might add), that July will be hot. How can I make this groundbreaking prediction? Because it is summer, meaning it is supposed to be hot, something most of the folks in the BRACE Industry( Brokers / Reporters / Analysts / Commentators / Economists) fail to realize as they scream at the top of their lungs about how catastrophic it is for crops. This wailing, gnashing of teeth and rending of garments is as seasonal as the swallows returning to Capistrano in March.

Corn Supplies Outpacing Demand Trends

What might make 2025 different? At the end of May, the end of the third quarter of the 2024-2025 marketing year, the National Corn Index was priced at $ 4.20 putting available stocks-to-use at 12.6 %. At the end of February, Q2 of the marketing year, the Index was $ 4.27 with available stocks-touse at 12.4 % meaning supplies of available corn had gained on demand over the past quarter. Additionally, the end of May 2025 available stocks-to-use figure was larger than the previous end of May average of 12.2 %.

The significance of all these numbers is that the U. S. was on pace to have larger-than-average supplies on hand throughout the fourth quarter of the marketing year, with the 2025 harvest possibly starting in late July and picking up in earnest during August. Given this, it seems likely the Corn Index, like the previously mentioned HRW Wheat Index, will continue its seasonal downtrend this month.

July 2025 | www. FarmersHotLine. com | 25