Corn Futures Slipping as Mixed Signals Pressure Markets

Corn futures continued slipping Monday, with contracts sliding 2 to 3.25 cents through midday trading. The CmdtyView national average cash corn price declined 2.75 cents to settle around $3.91 per bushel. This weakness came amid broader commodity market movements, as crude oil retreated $3.48 per barrel while the US dollar index gained $0.586 of strength.

Political Developments Shift Tariff Expectations

President Trump’s announcement of a revised trade arrangement with India’s President Modi injected a fresh dynamic into agricultural markets. The deal reduced tariffs on Indian goods from 25% to 18%, while India committed to purchasing over $500 billion of US energy, technology, agricultural products, coal and other items. This development carries particular weight for the ethanol sector, as India has maintained its position among the top three to four buyers of US ethanol historically. Such trade developments typically create uncertainty that can suppress commodity prices in the near term as markets digest implications.

Export Momentum Shows Signs of Moderation

Recent export inspection data revealed a softer pace of corn shipments. The week ending January 29 saw 1.136 million metric tons (44.74 million bushels) of corn shipped—a decline of 9.88% week-over-week and 26.55% below the equivalent week last year. Japan emerged as the leading destination with 444,439 metric tons, followed by Mexico with 260,227 metric tons and Colombia with 147,478 metric tons. However, the marketing year-to-date picture remains supportive, with cumulative shipments of 32.611 million metric tons (1.284 billion bushels) since September—still 49.86% above the comparable period in the prior year.

Large Speculators Reposition Holdings

Commitment of Traders data from the CFTC showed managed money speculators reducing their net short position in corn futures and options by 9,274 contracts during the week ending January 27. This reduction occurred primarily through new long accumulation, bringing the net short to 72,050 contracts. Commercial traders moved in the opposite direction, increasing their net short position by 17,381 contracts to 187,342 contracts—suggesting stronger hedging activity among cash market participants.

Brazilian Production Outlook Supports Global Supply

Looking at international supply dynamics, Brazil’s corn harvest progress remains behind historical pace. AgRural reported the first crop at 10% harvested versus 14% at this time last year, while the second crop advancement stands at 13% planted—4 percentage points ahead of prior year’s trajectory. StoneX provided revised production estimates, projecting the first crop at 26.59 million metric tons (up 610,000 MT from previous estimate) and the second crop at 106.37 million metric tons (representing a 560,000 MT upward adjustment). These increasing production expectations from major competitor suppliers add weight to the downward pressure on corn prices.

Futures Contract Structure Reflects Weakness

The futures complex displayed consistent weakness across multiple contract months. March corn futures slipped 3.25 cents to $4.25, while May contracts declined 3.25 cents to $4.32 and a half. July corn showed slightly less decline at 3 cents down to $4.39. Nearby cash positions mirrored the broader slipping trend, down 2.75 cents to $3.91 and a half. This across-the-board softness in corn pricing reflects the convergence of export softness, trade policy uncertainty, and expanding global supply prospects.