Commodity Markets
market, viewed corn as a buying opportunity.
Why Investors See Opportunity Now
But why? I know, my own Market Rule no. 5 tells us,“ It’ s the what, not the why,” but in this case investors would need a reason to increase their position. With U. S. stock indexes continuing to hit new all-time highs over the course of the summer and early fall, new money is being generated to be invested in markets with bullish longer-term fundamentals. We’ ve seen the cattle market find some of this interest as nearly every facet of the industry soared to new highs through early September.
Risk of the Poseidon Predicament
While providing incredible returns to investors, the move also increased the risk based on what I like to call the Poseidon Predicament.
This tells us that when everyone is on the same side of the boat, the boat tends to roll over. Again, why? Investors could start cashing in on some of the incredible returns seen over the past couple of years and move to the next market that looks to be a value opportunity.
Price Distribution Points to Value
I agree that corn looks to be a value investment. The NCI falling to its August 2025 settlement of $ 3.6850 put it in the lower 47 % of its 10-year price distribution range, meaning slightly below the 50 % level near $ 3.75.
While not indicating a solid buy, we have to keep in mind price distribution is but one of the filters in Market Rule no. 3: Use filters to manage risk, coming into play after we consider Rule no. 1( Don’ t get crossways with the trend) and Rule no. 2( Let the market dictate your actions).
Long-Term Trend Still Points Higher
As I talked about last year at this time, the long-term trend of the corn market turned up at the end of August 2024, so we know investors will be looking for buying opportunities.
As August 2025 ended, the May 2026-July 2026 futures spread( price difference between contracts) covered a bullish 28 % calculated full commercial carry. At the end of August 2024, the 2025 edition of this spread also covered 28 %, again setting the stage for a similar fall / winter move in the corn market.
The bottom line is the corn market is in a similar position to where it was a year ago. While I do not believe in analogous years due to Chaos Theory, there is enough evidence as of this writing to conclude yes, investors could view corn as a good buy. We’ ll see what happens over the next year.
About the Author
Darin Newsom has been working with markets in general for nearly 40 years, dating back to Black Monday 1987. Over that time, he has worked in local grain elevators, first dumping trucks then as a merchandiser, before becoming a commodity broker and advisor. That eventually led him to DTN where he spent 15 years as the company’ s senior market analyst before going out on his own with Darin Newsom Analysis, Inc.
These days, he also has the title of Senior Analyst for Barchart. Along the way, he has developed his own way of analyzing markets in every sector, always proudly reminding people that he is not an economist.
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