Now Is The Time To Evaluate Storage

DR. AARON SMITH

KNOXVILLE, TENNESSEE

Now is the time to evaluate storage. Farmers need to answer three questions regarding storage. 1) What is my estimated production? 2) How many bushels can be stored on the farm? and 3) Should the crop be stored? 

In Tennessee, there were some early season challenges with the crop getting planted in a timely manner. However, conditions have been good for most of the growing season. In Tennessee, the USDA estimates corn condition at 71% good-to-excellent and soybean condition at 67% good-to-excellent. Current conditions should translate to trendline yields or above for the state if conditions do not deteriorate in August. The average yield in Tennessee, based on current conditions, is likely to be 175-180 bushels per acre. Individual farm yields will vary but it is critical to estimate production when evaluating storage. 

On farm storage can be broken into two categories fixed and variable storage capacity. Most farms depend on bins (fixed) to store the crops. With bins capacity is fixed, and consideration will need to be given to reduced corn and soybean storage, if wheat remains in the bins. Grain bags may be an option to store crops that provide capacity flexibility. Grain bagging systems require purchases or leasing of equipment, but short-term flexibility can be a major asset. Storing corn and soybeans in bags presents additional challenges and requires expertise to implement effectively. 

Market prices and costs should be considered to determine if crops should be put in storage (even if storage capacity is available). Over the past 10 years in Tennessee storage has paid. Selling corn and soybeans in March versus September/October has resulted in an average cash selling price of $0.77/bu and $1.43/bu. This does not mean that storage pays every year. Richard Brock has often stated “I have purchased a cemetery plot, but I don’t plan to use it every year. Just because you have access to it does not mean you need to utilize it, this can be true for storage”. Farmers need to evaluate what the market is offering. This should include carry in the futures market (as of July 25 - $4.36 March corn versus $4.19 December corn), seasonal basis improvements (20-30 cents on average in Tennessee), infrastructure and handling costs (4-8 cents per bushel per month), and interest (3-4 cents per month for corn and 7-8 cents for soybeans). Costs and potential benefits should be evaluated before the crop is put in storage. 

Corn

Across Tennessee, average corn basis (cash price-nearby futures price) remained unchanged at West, Northwest, North-Central, West-Central, and Mississippi River elevators and barge points. Overall, basis for the week ranged from 5 under to 28 over, with an average of 11 over the September futures at elevators and barge points. Ethanol production for the week ending July 18 was 1.078 million barrels per day, down 9,000 compared to the previous week. Ethanol stocks were 24.444 million barrels, up 0.809 million barrels compared to last week. Corn net sales reported by exporters for July 11-17 were net sales of 25.3 million bushels for the 2024/25 marketing year and 28.9 million bushels for the 2025/26 marketing year. Exports for the same period were down 13% compared to last week at 41.7 million bushels. Corn export sales and commitments were 100% 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 102%. Cash prices ranged from $3.95 to $4.32 at elevators and barge points. September 2025 corn futures closed at $3.99, down 9 cents since last Friday. For the week, September 2025 corn futures traded between $3.97 and $4.08. Sep/Dec and Sep/Mar future spreads were 20 and 37 cents. 

Nationally, the Crop Progress report estimated corn condition at 74% good-to-excellent and 6% poor-to-very poor; corn silking at 56% compared to 34% last week, 58% last year, and a 5-year average of 58%; and corn dough at 14% compared to 7% last week, 16% last year, and a 5-year average of 12%. In Tennessee, corn condition was estimated at 71% good-to-excellent and 8% poor-to-very poor; corn silking at 85% compared to 78% last week, 86% last year, and a 5-year average of 85%; and corn dough at 43% compared to 30% last week, 45% last year, and a 5-year average of 41%. This week, Oct/Nov cash contracts ranged from $3.77 to $4.09 at elevators and barge points. December 2025 corn futures closed at $4.19, down 8 cents since last Friday. Downside price protection could be obtained by purchasing a $4.20 December 2025 Put Option costing 17 cents establishing a $4.03 futures floor. March 2026 corn futures closed at $4.36, up down 8 cents since last Friday. 

Soybeans

Across Tennessee average soybean basis strengthened or remained unchanged at West, Northwest, North-Central, West- Central, and Mississippi River elevators and barge points. Average basis ranged from 48 under to 25 over the August futures contract, with an average basis at the end of the week of 12 under. Soybean net weekly sales reported by exporters were net sales of 5.9 million bushels for the 2024/25 marketing year and 8.8 million bushels for the 2025/26 marketing year. Exports for the same period were up 30% compared to last week at 13.3 million bushels. Soybean export sales and commitments were 100% 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 102%. Cash soybean prices at elevators and barge points ranged from $9.55 to $10.35. August 2025 soybean futures closed at $9.98, down 29 cents since last Friday. For the week, August 2025 soybean futures traded between $9.96 and $10.19. The September soybean-to-corn price ratio was 2.51 at the end of the week. September 2025 soybean futures closed at $10.02, down 19 cents since last Friday. Aug/Sep and Aug/Nov future spreads were 4 and 23 cents. 

Nationally, the Crop Progress report estimated soybean condition at 68% good-to-excellent and 7% poor-to-very poor; soybeans blooming at 62% compared to 47% last week, 63% last year, and a 5-year average of 63%; and soybeans setting pods at 26% compared to 15% last week, 27% last year, and a 5-year average of 26%. In Tennessee, soybean condition was estimated at 67% good-to-excellent compared to 9% poor-to-very poor; soybeans blooming at 59% compared to 51% last week, 69% last year, and a 5-year average of 60%; and soybeans setting pods at 32% compared to 21% last week, 40% last year, and a 5-year average of 31%. Oct/Nov cash prices at elevators and barge points were $9.77 to $10.16 for the week. November 2025 soybean futures closed at $10.21, down 14 cents since last Friday. Downside price protection could be achieved by purchasing a $10.30 November 2025 Put Option which would cost 34 cents and set a $9.96 futures floor. Nov/Dec 2025 soybean-to-corn price ratio was 2.44 at the end of the week. 

Cotton

North Delta upland cotton spot price quotes for July 24 were 66.09 cents/lb (41-4-34) and 68.09 cents/lb (31-3-35). Upland cotton adjusted world price (AWP) increased 0.23 cents to 54.95 cents. Cotton net weekly sales reported by exporters were net sales cancellations of 32,700 bales for the 2024/25 marketing year and net sales of 132,600 bales for the 2025/26 marketing year. Exports for the same period were up 18% compared to last week at 184,800 bales. Upland cotton export sales were 107% 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 116%. 

Nationally, the Crop Progress report estimated cotton condition at 57% good-to-excellent and 13% poor-to-very poor; cotton squaring at 71% compared to 61% last week, 79% last year, and a 5-year average of 75%; and cotton setting bolls at 33% compared to 23% last week, 40% last year, and a 5-year average of 33%. In Tennessee, cotton condition was estimated at 49% good-to-excellent and 25% poor-to-very poor; cotton squaring at 69% compared to 62% last week, 87% last year, and a 5-year average of 82%; and cotton setting bolls at 32% compared to 18% last week, 49% last year, and a 5-year average of 38%. December 2025 cotton futures closed at 68.22 cents, down 0.46 cents since last Friday. For the week, December 2025 cotton futures traded between 67.8 and 68.99 cents. Dec/Mar and Dec/May cotton futures spreads were 1.43 cents and 2.49 cents. Downside price protection could be obtained by purchasing a 69 cent December 2025 Put Option costing 2.54 cents establishing a 66.46 cent futures floor. March 2026 cotton futures closed at 69.65 cents, down 0.33 cents since last Friday. May 2026 cotton futures closed at 70.71 cents, down 0.3 cents since last Friday. 

Wheat 

Wheat net weekly sales reported by exporters were net sales of 26.2 million bushels for the 2025/26 marketing year. Exports for the same period were up 76% compared to last week at 28.0 million bushels. Wheat export sales were 39% of the USDA estimated total annual exports for the 2025/26 marketing year (June 1 to May 31), compared to the previous 5-year average of 37%. Nationally, the Crop Progress report estimated winter wheat harvested at 73% compared to 63% last week, 75% last year, and a 5-year average of 72%; spring wheat condition at 52% good-to-excellent and 16% poor-to-very poor; and spring wheat headed at 87% compared to 78% last week, 87% last year, and a 5-year average of 88%. Wheat cash prices at elevators and barge points ranged from $4.85 to $5.18. 

September 2025 wheat futures closed at $5.38, down 8 cents since last Friday. September 2025 wheat futures traded between $5.34 and $5.52 this week. Sep/Dec and Sep/Jul future spreads were 20 and 57 cents. The September wheat-to-corn price ratio was 1.35. December 2025 wheat futures closed at $5.58, down 9 cents since last Friday. July 2026 wheat futures closed at $5.95, down 7 cents since last Friday. Downside price protection could be obtained by purchasing a $5.95 July 2026 Put Option costing 49 cents establishing a $5.46 futures floor.    ∆

DR. AARON SMITH

UNIVERSITY OF TENNESSEE