September’s Bullish Bias Faces Its First Major Test

Prices cooled off to end the week as long weekend positioning and profit taking were featured ahead of the Labor Day break. US weather remains too hot and dry for roughly half the corn and bean crops with little relief forecast through mid-month. China was noted as an active buyer of US beans and continues the goodwill momentum heading into the trade summit on September 24th. Almost every underlying fundamental or technical factor is either outright bullish or leaning bullish heading into the Friday September 11th USDA yield update where the deteriorating crop conditions hint that the USDA should continue to trim yield expectations. Harvest will continue to move north with yield monitors and social media reports closely watched in the weeks ahead to give the trade a more concrete idea on production.

News and Notes:

• Brutal heat continues to envelope the S Plains, SW and Delta with little rain for the rest of the Corn Belt. Crop conditions are expected to drop again in the delayed weekly crop condition report on Tuesday after a tough 2-week weather pattern on corn and bean fill. Super El Nino continues to be a concern as the southern hemisphere planting/growing season begins with SA, India and Australia already seeing inconsistent seasonal weather problems.
• Profit taking ahead of the 3-day weekend after a strong late August rally is the prominent feature on the charts on Page 2. Wheat was the largest weekly loser as US envoys visited Ukraine and Russia this weekend to try to work on a ceasefire and possible re-opening of Black Sea exports. The pullbacks last week are helping offset the deeply overbought conditions, but the funds continue to have interest in the soy complex and the grains as US yield concerns remain. The funds will be more neutrally positioned ahead of next Friday’s USDA yield update but will be ready to defend and add to their bullish positioning on any supportive news from the report. The daily, weekly and monthly charts are pointing toward thepotentialof corn making a run at $6, beans to $14 and wheat to $8.
• Last week’s trip to the Iowa Farm Progress Show produced a few good interviews about the markets and new products to help increase your yield and efficiency. Please listen to Helena’s FieldLink podcast and my first appearance on Talk Dirt to Me. Thanks Bill, Logan, Bobby Lee and Austin.
• Weekly Changes: Corn unchanged (Sep ‘26), + 1/4 (Dec ‘26), Beans  + 17 1/2 (Sep ‘26), + 21 3/4 (Nov ‘26), Wheat - 50 (Sep ’26), Crude - 366, Diesel + 2552, Dow - 144, US Dollar  - 508, Cattle + 120, Feeder Cattle – 75 , Hogs  + 40, Cotton - 505, Milk - 2 (16.39).

With the Labor Day weekend winding down, the markets will be on a dead sprint into several major events in the weeks ahead. Friday’s USDA yield update will be the first major event, the poor finishing weather for the US crop will be an ongoing factor, negotiations on ending each war will continue, with each of these leading up the September 24th US/China trade summit in Washington. Each of these events has both bullish and bearish potential. Lower US yield estimates and a successful trade meeting with China will keep the counter-seasonal bull markets intact while a re-opening of the Black Sea shipping corridor and a bearish surprise from the USDA could slam the brakes on the rallies. The most likely outcome is somewhere in the middle as the US crops have some irreversible yield loss, and despite diplomatic efforts, the wars do not appear close to ending. Volatility with a bullish bias remains our outlook through a busy September. Opening calls are slightly higher as weekend diplomatic meetings did not produce any concrete results, and with additional bombing on all fronts, crude is up over $1.50, back over $90 a barrel and making new contract highs. Enjoy your Labor Day!