• Seasonally, the National Cash Index tends to rally during the winter while December futures move into hibernation. 

• Fundamentally, the market looks to be more bearish than a year ago, but things could change next spring. 

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• From a structural point of view, it could still be argued the corn market is set to rally over the winter and spring quarters. 

Somehow, the end of another year is coming up fast in the windshield. Where 2025 went, I have no idea, but it is largely behind us now. For this piece, let's look ahead at what next year might bring for the market I follow more than any other – Corn. As we get set to move into the next two weeks of holiday disrupted trade, it gives me time to address three key questions in the corn market, largely from an investment point of view, but those who are in agriculture are invested in King Corn as well. Not only is corn the leader of the Grains sector but has close ties with what happens out in the Barn (Livestock sector) as well. As you know I view corn as the bonds of the ag industry, and not because the market is exciting like James, as in Agent 007, but because it is usually boring like US Treasuries. Last but certainly not least there is King Corn’s Royals Connection that has to do with the inverse relationship between the fortune of the Kansas City Royals Major League Baseball team and the December corn futures contract. But that is a discussion for another day. 

Question #1: Has King Corn settled down for his long winter’s nap? My friend in the brokerage industry called recently and asked when I was going to break out this old saying. I thanked him for reminding me. I’ve been planning on writing about the evolution of my seasonal and price distribution analysis, two of the filters in Market Rule #3: Use filters to manage risk, but market events continue to pop up. As for corn’s seasonal tendencies during the winter quarter (December through February), while the National Corn Index tends ($CNCI) to rally, gaining roughly 5% from the last weekly close of November through the final weekly close of February, the new-crop December futures contract does next to nothing. With that in mind, a look at weekly closes for the December 2026 issue (Dec26) shows it was priced the last weekly close of November 2025 at $4.6825 and was sitting at $4.62 heading into this week’s trade. Looking ahead, December corn tends to rally 5% during the spring quarter before losing 6% during the summer and adding 4% back through the fall. Is December corn slumbering this winter? My answer would be yes, tucked in comfortably between the round numbers of $4.60 and $4.70. For now. 

Question #2: Are global corn stocks at a 13-year low? When I answered a call from a friend in central Illinois, I knew something was up by the way he laughed when he said, “I have a question for you: Are global corn stocks at a 13-year low?” My friend knows me well, so he knew what my answer would be: I don’t know. But more importantly, I don’t care. Yes, the BRACE Industry has been nattering about the latest USDA guesses since the latest WASDE report was released on December 9. Within the data dump was USDA’s global ending stocks guess for the 2025-2026 marketing year of 279.15 million metric tons (mmt), down from the previous guess of 281.34 mmt and the previous marketing year’s guesstimate of 293.37 mmt. Reportedly, this number sets the stage for the lowest stocks-to-use in 13 years. While I do appreciate the fact the discussion was switched from “ending stocks” to “stocks-to-use”, taking into account supply AND demand, I’ll say again, I don’t care. 

Let’s apply Market Rule #2: Let the market dictate your actions. What is the market telling us? As last week came to an end, the National Corn Index was priced at $4.0370. The previous 5-year end of December low price for the Index is $4.3179 from last year, with the previous 10-year average end of December price coming in at $4.2967. Based on the economic Law of Supply and Demand, this tells us the fundamental situation in the United States is more bearish than it has been the past 5 years and is more bearish than usual the past 10 years. Given the US is the world’s largest producer, user, and exporter of corn, if global supply and demand were a problem it would show up in the Index, the intrinsic value of the market. That being said, the latest weekly export sales and shipments update, through Thursday, November 27, showed the US on pace to ship 4.5 billion bushels (bb) of corn during the 2025-2026 marketing year, a 67% increase from the reported 2.72 bb shipped during the 2024-2025 marketing year. USDA’s latest guess put US exports for 2025-26 at 3.2 bb (81.28 mmt). We’ll see how this plays out over the coming months. 

Question #3: Do I still have confidence in the corn market? This question is tied, again, to my view of corn being a good investment. Additionally, based on my long-term analysis of the various aspects of the market, corn was a buy at the close of August 2024 and August 2025 (See Monthly Analysis: Grains). Investors might be long the Dec26 futures contract (ZCZ26) near $4.62 (about where it closed last Friday) or the Teucrium CORN (CORN) ETF (or other exchanged traded fund). End-users and producers would be long the cash market based on similar price patterns with the National Corn Index. Am I still confident in these positions? Based on structure of the corn market, yes. 

I’ve talked in the past about something I call the Analogy Fallacy. Many in the BRACE Industry waste their time, and ours, by looking for analogous years for the purpose of making predictions. However, due to Chaos Theory we know there is no such thing as analogous years because at least one market factor is bound to be different, possibly changing the result. What I see from both funds and fundamentals tells me the corn market could see a solid seasonal winter/spring rally. Since Rule #6 tells us, “Fundamentals win in the end”, let’s start with supply and demand. 

At last Friday’s close, the end of the third week of December, the May 2026-July 2026 corn futures spread covered a bullish 28% calculated full commercial carry (total cost, storage and interest, to hold bushels in a commercial facility). This tells us merchandisers have a concern about sourcing supplies to meet demand next spring. This could be due to planting season slowing shipments of corn from off farm to commercial facilities, the possibility remaining supplies have been exhausted, or continued strong export demand. It could be any, all, a combination of, or none of these things. We don’t know. But we can see there is a concern. We saw something similar last year when the 2025 edition of the spread closed the same week covering 13%. As with the Index price itself, we know this year’s real fundamentals are not as bullish as what was in place last year at this same time. But it is still a bullish longer-term view. 

As for funds, based on the selloff seen in the futures market through mid-December, we can conclude Watson has likely reduced its net-long futures position to near par. Last year, funds held a net-long position of 222,000 contracts mid-December with the position swelling to 469,000 contracts by mid-February, again due to the fundamental read of futures spreads. If the 2026 edition of the spread remains bullish, it could spark similar, but not the same, noncommercial buying interest during the remainder of the winter and spring quarters.