New Crop Futures Prices Trading In A Sideways Pattern

DR. AARON SMITH

KNOXVILLE, TENNESSEE

New crop corn, soybean, and cotton futures prices are trading in a sideways pattern. Since the start of the year, December corn (range $4.36 to $4.80; average $4.55), November soybean (range $9.78 to $10.74; average $10.32) and December cotton (range 66.2 to 70.8 cents; average 68.9 cent) futures prices have been traded in well-established trading ranges. Current harvest futures prices are very close to the January 1 to May 23 average daily close. 

When will we see a major move in price direction? Looking at recent history for new crop harvest futures prices for corn and soybeans indicate a major move could occur starting at the end of May or early June. Planting progress and early season weather conditions are the primary culprits for the late May to mid-June price movements. In 2022 and 2024 prices broke lower; in 2023 prices moved higher. From May 23 to June 23 the previous three years the December corn contract decreased 83.5 and 34.75 cents in 2022 and 2024; in 2023 the December corn contract increased 71.25 cents. Similarly, the November soybean contracts decreased 103.25 and 85.5 cents and increased 122.25 cents in 2022, 2024, and 2023, respectively. 2025 prices may be poised for a move outside of the established trading range however it remains uncertain as to which direction prices will go. 

A short-term price risk management strategy to protect against a potential downside price movement in futures markets in the next 30 days is to purchase an out of the money put option. For example, on May 23 a $4.40 2025 December corn put option could be purchased for 25 cents. If prices break lower the next 30 days purchasing the put option provides the security of a futures market price floor. If prices break higher the put option could be sold and a portion of the premium recovered at the end of June (the put option would still have time value that can be recovered). This put option strategy is not designed to secure a final futures market price. The strategy is designed to strategically remove futures market price risk during a time period when volatility over the previous three years has occurred. Understanding and developing strategies that can remove price risk at key times during the production and marketing year is essential during low price, tight margin environments.

Corn

Across Tennessee, average corn basis (cash price-nearby futures price) weakened or remained unchanged at West, Northwest, North-Central, West-Central, and Mississippi River elevators and barge points. Overall, basis for the week ranged from 25 under to 30 over, with an average of 10 over the July futures at elevators and barge points. Ethanol production for the week ending May 16 was 1.036 million barrels per day, up 43,000 compared to the previous week. Ethanol stocks were 24.944 million barrels, down 0.501 million barrels compared to last week. Corn net sales reported by exporters for May 9-15 were net sales of 46.9 million bushels for the 2024/25 marketing year and 8.6 million bushels for the 2025/26 marketing year. Exports for the same period were up 13% compared to last week at 62.6 million bushels. Corn export sales and commitments were 96% of the USDA estimated total annual exports for the 2024/25 marketing year (September 1 to August 31) compared to the previous 5-year average of 96%. Cash prices ranged from $4.22 to $4.93 at elevators and barge points. July 2025 corn futures closed at $4.59, up 16 cents since last Friday. For the week, July 2025 corn futures traded between $4.43 and $4.64. September 2025 corn futures closed at $4.37, up 16 cents since last Friday. Jul/Sep and Jul/Dec future spreads were -22 and -9 cents. 

Nationally, the Crop Progress report estimated corn planted at 78% compared to 62% last week, 67% last year, and a 5-year average of 73%; and corn emerged at 50% compared to 28% last week, 38% last year, and a 5-year average of 40%. In Tennessee, corn planted was estimated at 83% compared to 76% last week, 82% last year, and a 5-year average of 86%; and corn emerged at 65% compared to 51% last week, 60% last year, and a 5-year average of 64%. December 2025 corn futures closed at $4.50, up 15 cents since last Friday. Downside price protection could be obtained by purchasing a $4.60 December 2025 Put Option costing 36 cents establishing a $4.24 futures floor. This week, Oct/Nov cash contracts ranged from $4.14 to $4.63 at elevators and barge points. 

Soybeans

Across Tennessee the average soybean basis weakened or remained unchanged at West, Northwest, North-Central, West- Central, and Mississippi River elevators and barge points. Average basis ranged from 40 under to even the July futures contract, with an average basis at the end of the week of 13 under. Soybean net weekly sales reported by exporters were net sales of 11.3 million bushels for the 2024/25 marketing year and 0.6 million bushels for the 2025/26 marketing year. Exports for the same period were down 42% compared to last week at 9.2 million bushels – a marketing year low. Soybean export sales and commitments were 96% of the USDA estimated total annual exports for the 2024/25 marketing year (September 1 to August 31), compared to the previous 5-year average of 99%. Cash soybean prices at elevators and barge points ranged from $10.10 to $10.68. July 2025 soybean futures closed at $10.60, up 10 cents since last Friday. For the week, July 2025 soybean futures traded between $10.45 and $10.73. The July soybean-to-corn price ratio was 2.31 at the end of the week. August 2025 soybean futures closed at $10.56, up 10 cents since last Friday. Jul/Aug and Jul/Nov future spreads were -4 and -10 cents. 

Nationally, the Crop Progress report estimated soybeans planted at 66% compared to 48% last week, 50% last year, and a 5- year average of 53%; and soybeans emerged at 34% compared to 17% last week, 25% last year, and a 5-year average of 23%. In Tennessee, soybeans planted were estimated at 53% compared to 44% last week, 52% last year, and a 5-year average of 45%; and soybeans emerged at 34% compared to 23% last week, 33% last year and a 5-year average of 24%. Oct/Nov cash prices at elevators and barge points were $9.97 to $10.68 for the week. November 2025 soybean futures closed at $10.50, up 15 cents since last Friday. Downside price protection could be achieved by purchasing a $10.60 November 2025 Put Option which would cost 54 cents and set a $10.06 futures floor. Nov/Dec 2025 soybean-to-corn price ratio was 2.33 at the end of the week. 

Cotton

North Delta upland cotton spot price quotes for May 22 were 63.88 cents/lb (41-4-34) and 65.88 cents/lb (31-3-35). Adjusted World Price (AWP) decreased 0.38 cents to 53.52 cents. Cotton net weekly sales reported by exporters were net sales of 141,400 bales for the 2024/25 marketing year and 7,400 bales for the 2025/26 marketing year. Exports for the same period were down 24% compared to last week at 251,500 bales. Upland cotton export sales were 109% of the USDA estimated total annual exports for the 2024/25 marketing year (August 1 to July 31), compared to the previous 5-year average of 110%. July 2025 cotton futures closed at 66.11 cents, up 1.22 cents since last Friday. For the week, July 2025 cotton futures traded be- tween 64.88 and 66.53 cents. Jul/Dec and Jul/Mar cotton futures spreads were 2.52 cents and 3.89 cents. 

Nationally, the Crop Progress report estimated cotton planted at 40% compared to 28% last week, 42% last year, and a 5-year average of 43%. In Tennessee, cotton planted was estimated at 49% compared to 29% last week, 49% last year, and a 5-year average of 45%. December 2025 cotton futures closed at 68.63 cents, up 0.96 cents since last Friday. Downside price protection could be obtained by purchasing a 69 cent December 2025 Put Option costing 3.93 cents establishing a 65.07 cent futures floor. March 2026 cotton futures closed at 70 cents, up 0.94 cents since last Friday. 

Wheat 

Wheat net weekly sales reported by exporters were net sales cancelations of 0.5 million bushels for the 2024/25 marketing year and net sales of 32.1 million bushels for the 2025/26 marketing year. Exports for the same period were up 18% compared to last week at 16.1 million bushels. Wheat export sales were 97% of the USDA estimated total annual exports for the 2024/25 marketing year (June 1 to May 31), compared to the previous 5-year average of 105%. Wheat cash prices at elevators and barge points ranged from $4.49 to $4.85. 

Nationally, the Crop Progress report estimated winter wheat condition at 52% good-to-excellent and 18% poor-to-very poor; winter wheat headed at 64% compared to 53% last week, 67% last year, and a 5-year average of 58%; spring wheat planted was estimated at 82% compared to 66% last week, 76% last year, and a 5-year average of 65%; and spring wheat emerged at 45% compared to 27% last week, 40% last year, and a 5-year average of 34%. In Tennessee, winter wheat condition was estimated at 70% good-to-excellent and 7% poor-to-very poor; winter wheat jointing at 96% compared to 95% last week; and winter wheat headed at 91% compared to 88% last week, 92% last year, and a 5-year average of 95%. July 2025 wheat futures closed at $5.42, up 17 cents since last Friday. July 2025 wheat futures traded between $5.24 and $5.56 this week. Downside price protection could be obtained by purchasing a $5.45 July 2025 Put Option costing 17 cents establishing a $5.28 futures floor. Jul/Sep and Jul/Dec future spreads were 16 and 38 cents. The July wheat-to-corn price ratio was 1.18. July cash contracts at elevators and barge points ranged from $4.81 to $5.49. September 2025 wheat futures closed at $5.58, up 19 cents since last Friday. December 2025 wheat futures closed at $5.80, up 20 cents since last Friday.   ∆

DR. AARON SMITH: University of Tennessee