Market Commentary for 4/28/25

Jon Scheve with weekly market commentary made on April 25, 2025

The corn market doesn’t seem concerned with the possibility of tighter stocks, which may mean there is more supply than the USDA is currently estimating. 

One indication of this is that both wheat and sorghum’s basis values in the southwestern corn belt are much lower than normal for this time of year. This is pulling down corn’s basis value there too, which is unusual. Typically, the southwestern corn belt pulls corn to it this time of year, it rarely pushes it away like we are seeing now.

The ample wheat stocks from last harvest are likely causing some of this. Plus, current weather conditions are average to slightly above normal for the next wheat crop compared to the last 5 seasons. This suggests wheat stocks will likely stay the same or increase a little in the next marketing year. This could put downward pressure on prices and keep wheat in the feed ration longer at the expense of corn.

Sorghum is being severely impacted by the trade war with China. In the last few years, China has purchased most of the US sorghum crop at a higher value than corn. However, the trade war has halted these purchases. If China doesn’t buy US sorghum, it can only be used for feed. And due to its efficiency in feed diets, it will need to trade at a discount to corn. Currently, there is way too much sorghum left from last year, and it looks likely there will be significantly more acres planted this year. Therefore, sorghum’s issues may eventually become corn’s problem.

This would seem to indicate the corn used for feed estimate is too high. However, I’m starting to doubt the USDA will change their feed estimate until after the June stocks report, or they may even wait until after the September report. That could keep corn prices from dropping substantially in the short term. Plus, there is still weather risk going into the growing season, so prices may remain range bound for the next few months.

Speaking of range-bound prices, corn finished the week within the same 15-cent trading range it’s been in for the past 2 weeks, and it finished almost exactly in the middle of the range it’s been trading since mid-December. It’s difficult to see a reason why it will leave this range anytime soon.

Jon Scheve

Superior Feed Ingredients, LLC

9358 Oak Ave

Waconia, MN 55387

jon@superiorfeed.com