Brazil’s election just became a U.S. marketing issue.
The biggest story for U.S. grain markets the last week of October did not happen in the Corn Belt. It happened in Brazil.
Brazilian markets sold off on Oct. 26 after Luiz Inácio Lula da Silva’s surprise runoff win secured him a fourth term, and the Brazilian real weakened on the news.
Why should a Midwest farmer care? A weaker real means Brazilian farmers earn more in their own currency for every bushel they sell in dollars. That makes them more willing sellers, especially for new crop. Uncertainty over whether President Doanld Trump will recognize the election results has added even more volatility to the currency.
The result is simple: Our biggest export competitor just got a little more aggressive, right as U.S. harvest pressure is peaking.
A record soybean crop?
Aiming for a record, Brazil is planting soybeans quickly. Planting reached 42.8%, ahead of the 40.2% average, and the 2026-27 crop is expected to be a record. A consultant’s estimate holds Brazil’s crop steady at 182 million metric tons.
Weather is also helping. Forecasts call for 1.5 to 4 inches of rain across Brazil’s growing areas, though excess moisture is a concern in the southern region.
Brazilian offers have already softened on expectations of more supply. That is direct competition for U.S. beans in the world market, and concern over non-China export demand for U.S. soybeans continues.
Here at home, our proprietary Advance Trading Inc. research holds 2026-27 U.S. ending stocks unchanged at 316 million bushels, right in line with USDA’s 315 million-bushel estimate. That is a balanced supply and demand picture, not necessarily a burdensome one. The average crop insurance harvest price for November soybean futures stands around $12.50 as of this writing.
Higher corn stocks
Corn is a different story. Our ATI research puts 2026-27 U.S. corn ending stocks at 2.087 billion bushels, well above USDA’s latest forecast of 1.849 billion bushels. The main driver is exports: ATI lowered its export forecast by 180 million bushels because sales continue to be weak.
Harvest is also running behind. USDA’s Crop Progress report shows corn 60% harvested versus the five-year average of 66%, with good-to-excellent ratings unchanged at 56%. Down south, Brazil’s first-crop corn is 58% planted versus 55% last year, with total production steady at 140 MMT. The market remains range-bound, with export concerns lingering.
Warm, wet wheat weather
Persistent warmth is expected across major U.S. crop regions over the next 10 to 20 days. Hard red winter and soft red winter wheat areas could be among the warmest of the past 48 years, due to a lack of cold air in the Northern Hemisphere. Near-term rains of a 0.5 to 1.5 inches hit western Plains wheat and parts of the northern Corn Belt, followed by mostly dry weather through most of October. That dry window should help harvest catch up.
A more active pattern then brings 1 to 2.5 inches of rain across corn, soybean and winter wheat regions through early November. Western Oklahoma could see 200% to 300% of normal precipitation, which matters because Oklahoma is already 18 points behind its five-year winter wheat planting pace. Arkansas trails by 16 points and Ohio by 10.
U.S. wheat markets remain defensive as buyers give Black Sea talks a chance.
Weaker hog, beef, ethanol markets
For cattle producers, the 5-Area weekly steer price of $227.06 per cwt sits $10.83 below last year.
Hog producers face a tougher setup. ATI research shows hog crush value at $30.84 per cwt, compared with $49.09 a year ago, which is a sharp squeeze on margins.
On the energy side, most ethanol basis locations weakened, which is worth watching for anyone tied to local ethanol plant bids.
The common thread in all this is competition and patience. A weaker real and a fast-planted, potentially record Brazilian soybean crop put pressure on U.S. export demand. A corn balance sheet that may be looser than USDA projects means rallies could be harder to come by.
Three practical questions to ask yourself now include:
- Do you have a plan for unpriced bushels in storage and target prices set ahead of time?
- Are you comparing current futures against the crop insurance harvest prices of $4.805 for corn and $12.72 for soybeans?
- Are you watching the Brazilian real? Further currency weakness could mean more aggressive Brazilian selling.
Markets reward farmers who plan rather than react. To talk through your marketing plan, you can contact ATI at info@advance-trading.com or 309-664-2300.
The risk of trading futures and options can be substantial. Past performance is not necessarily indicative of future results.