Extreme energy-market volatility overtakes grain and oilseed price direction

Tanner Ehmke

April 8, 2026

Key Points

• Market volatility offered farmers new marketing opportunities in grains and oilseeds in the first quarter.
• Farmers plan to shift acres to soybeans in 2026 and away from corn and wheat.
• Drought is again plaguing the U.S. winter wheat crop, and producers look to El Nino for potential relief.

Energy-market volatility following the closure of ship traffic through the Strait of Hormuz drove grain and oilseed prices late last quarter. Although crop prices rallied with crude oil prices, the surge in farm input prices complicates spring planting decisions for some farmers. USDA’s Prospective Plantings report released on March 31 indicated U.S. farmers will be expanding soybean acreage in 2026, as soybeans offer lower production costs and prices relatively higher than other crops. Soybean prices rose 11.8% last quarter, driven by the rally in soybean oil; corn increased 4% and wheat gained 21.5%.

USDA’s Prospective Plantings report indicated farmers will plant 84.7 million acres with soybeans, up 4% year-over-year, while slashing corn and spring wheat acres.

Corn

Corn planted acreage is projected to fall to 95.3 million acres this spring, down 3.8% YoY as farmers see more profitability in soybeans. Corn’s record harvest in 2025 limited its participation in last quarter’s price recovery with soybeans, while rising production costs, especially in fertilizer, are eroding profitability for farmers who had not yet secured inputs.

Corn demand remains resilient, driven by record supply and low prices. Exports are the strongest in history thanks to record shipments to key markets like Mexico, Japan, South Korea and Colombia. Ethanol demand for corn is strong but is tempered by competitively priced grain sorghum. Feed demand is improving, especially in the poultry sector, but is moderated by the lack of recovery in the beef herd.

USDA reported March 1 corn stocks at 9.024 billion bushels, up 10.8% YoY. Implied corn usage totaled 4.281 billion bushels since Dec. 1, 2025 — a new record driven mostly by exports moving at breakneck speed. Even with record usage, supplies remain ample, offering strong carries in the futures market and benefiting grain merchandisers. Next quarter, markets will watch U.S. planting conditions and the size of the Brazilian safrinha corn harvest.

Soybeans

Anticipation of EPA’s renewable volume obligation finalization, along with expectations for expanded soybean oil usage in the U.S., lifted soybean prices last quarter despite a slower export pace. Concerns about Brazilian crop quality and phytosanitary restrictions that impeded Brazilian soybean exports also lifted expectations that Chinese demand would return to the U.S. Total U.S. soybean export commitments in March were down 18% YoY, with Chinese demand down 49% YoY year as China still maintains a tariff of 13% on U.S. soybeans.

USDA pegged U.S. soybean stocks on March 1 at 2.104 billion bushels, up 10.1% YoY amid lethargic exports to China. Exports to other countries, though, are up while domestic crush continues to accelerate to record highs.

Wheat

U.S. farmers plan to drastically cut wheat acreage to the lowest since recordkeeping began in 1919. Spring wheat acreage is expected to fall 5.4% YoY to 9.4 million acres as farmers in the Northern Plains transition to more corn, soybean and canola. Winter wheat acreage is projected down 5.4% at 32.4 million acres, while durum is expected to fall 11.4% YoY to 2 million acres.

The U.S. had ample wheat stocks on March 1, up 5.1% YoY at 1.3 billion bushels. Expanding drought conditions in the Plains and Midwest are raising concerns for the U.S. winter wheat crop. Farmers hope an El Niño event brings moisture relief before harvest.