Blue wave, landslide, turning point — midterm elections will give Washington a new look. But agriculture isn’t likely to see a major overhaul.
Faces on important Congressional committees will shuffle, notably those pounding gavels and calling witnesses. But passage of a farm bill is still overshadowed by high-profile issues like data centers, energy prices, and wars in Ukraine and the Middle East that cut through the heart of ag country. So, the more things seem ready to change, the more they probably won’t.
With less than two months before members are sworn in for the 120th Congress, the clock is ticking to pass anything in the current session, which has three weeks or less of actual working days remaining. Lame ducks must limp home bills on spending and the national debt limit, opportunities for horse trading, and stalemates that include presidential vetoes and other executive actions likely to trigger lawsuits headed to the Supreme Court.
Election or not, markets will grind through data and world events until the next big explosion breaks the logjam. Humbling matters this week is the Veterans Day observance that banks and the bond market will recognize by closing Nov. 11. But first, USDA sets the stage Nov. 10 with updated World Agricultural Supply And Demand Estimates. December projections normally don’t change much, so this November release sets the bar until annual estimates come out in January.
Here’s what could matter in tomorrow’s WASDE.
More soybeans, less corn
On the supply side of the ledger, USDA updates production estimates for both corn and soybeans. Crop ratings and vegetation health indexes ended the growing season pointing to corn production that falls short of the 16 billion bushels the government projected in October, but soybean numbers could be a little higher than the 4.56 billion bushels printed last month.
Total supply combines imports, production and carryout from the previous marketing year, all based on objective surveys. Demand is a more subjective calculation: What will be, not what was. By definition, this creates more opportunity for chaos. Here’s where the fur could fly.
Soybeans are especially ripe for swings. The U.S. growing season is ending. The opposite is true in the Southern Hemisphere, where fields are just starting amid the backdrop of never-ending news alarms about the El Niño warming of the equatorial Pacific Ocean. Spoiler alert: This much-touted weather phenomenon actually is associated with better-than-normal yields in Argentina and doesn’t have a noticeable impact on Brazil. Overall, crops are in better shape so far compared to a year ago.
In theory, countries clear soybean surpluses by pushing exports in the months right after harvest to avoid competition from the next new-crop harvest in the other hemisphere. China customs data indicates that happened this year, with imports from the U.S., as usual, falling to almost nothing as the 2025-26 marketing year ended in August.
But economics are only part of the game’s equation, and China doesn’t play checkers. Rather, its moves embrace three-dimensional chess complicated by domestic and international politics. Brazil just had an election too. Leftist Luiz Inácio Lula da Silva won a surprise fourth term as president, defeating Flávio Bolsonaro, who fled to the U.S. for asylum and previously was a harsh critic of Beijing. Bolsonaro’s father, Jair, is in jail after losing in 2022 to Lula, a Chinese ally.
China used soybean diplomacy to shut off imports from the U.S. in response to Trump administration tariffs, finally agreeing to purchase at least 25 million metric tons from the U.S. annually through 2028. Sales so far in 2026 are still around 25% short of that goal, and China understands all too well that farmers are a key component of Trump’s coalition. So, who knows what a final “deal” could look like?
Biofuels drive corn
Soybean demand comes from two main sources: crush and exports. Corn usage is more diffuse. In addition to sales overseas, domestic usage reflects how much is fed to livestock or ground by ethanol plants. How much walks off the farm is a function of both price and the number of critters at the trough, and estimates are iffy at best.
Biofuels are a bedrock of corn, helping so-called industrial usage to become the largest category of demand. Ethanol exports could benefit if buyers abroad need it to meet climate goals. But mandates are a divisive issue in the U.S., and politics also could impact these sales. My models put the total corn grind for ethanol on track to beat USDA’s forecasts by around 140 million bushels, if the hand of the market is left on its own. But if white-gloved lawyers and lobbyists tip the scales, production could be better or worse. Resolution of the Iran war could cheapen gasoline prices and increase demand for blending, another variable in play after the election.
Ahead of these developments, my model suggests the expected corn surplus on Aug. 31, 2027, could be slightly tighter than USDA expected in October, but the average cash price received by farmers could be 25 to 50 cents lower than the $4.70 USDA forecast.
Soybean carryout could be higher by around 25 million bushels, putting the government’s $12 average cash price in October in jeopardy.
Good news is bad?
The final election fallout could come on Wall Street, where fears of long-term inflation and artificial intelligence bubbles churned stomachs last week on worries that good news might really be bad news. Unemployment dropped in October after the economy added 165,000 jobs, suggesting a thriving economy amid all the angst. But the strong report also could give the Federal Reserve a green light to raise interest rates, and investors are braced for two quarter-point hikes over the next year.
Indeed, after wild swings the past decade, key financial metrics reverted to the mean on inflation, unemployment and interest rates. That could mean an extended winter of choppiness, or presage a breakout and a move back to volatility.
