USDA’s initial World Agricultural Supply and Demand Estimates for the 2026-27 crop marketing year seemed to offer something for both bulls and bears — with maybe a slight edge for the latter crowd.
Not that the bears stand much of a chance in the current market environment, with the U.S.-Iran war dragging on, the Strait of Hormuz jammed shut, and crude oil trading north of $100. Traders quickly brushed off the mid-May data and kept corn on an upward track, sending December futures to a 2½-year high above $5.06 one day after the report.
The new-crop estimates USDA typically rolls out in its May WASDE report offer good food for thought but should also be consumed with perhaps a bushel or two of salt. Forget pinches. With U.S. corn and soybeans just barely in the ground, May’s numbers are little more than educated guesses that will be revised often in the months ahead.
The grain trade quickly shifted its attention back to weather and war. But the May WASDE numbers still offer farmers something to chew on and possible clues as to how this year’s market may play out. Here’s four of them:
Big crops can get smaller but still stay big. With corn plantings poised to drop sharply, this year’s harvest likely won’t come close to last year’s 17.02 billion-bushel monster. USDA pegged the 2026 crop at 15.995 billion bushels (based on the agency’s previously reported planted acreage at 95.3 million and trend-line average yield at 183 bushels per acre). A drop of 1 billion bushels seems like a lot, but in 2026, it would still result in the second-biggest harvest ever.
Heavy supply carries over into another year. USDA raised its estimate for 2025-26 U.S. ending corn stocks by 15 million bushels to 2.142 billion bushels, a seven-year high. But in its initial 2026-27 numbers, USDA barely avoided posting a dreaded 2 billion-bushel carryout for a second consecutive year. For 2026-27, USDA sees U.S. ending stocks shrinking 8.6% to 1.957 billion bushels.
Global supplies are tightening amid strong demand. USDA also projected a 6.5% drop in global corn stocks to a 13-year low at 277.5 million metric tons (10.9 billion bushels). Excluding China, global stocks are seen shrinking 6.2% to 111.4 MMT, near the 12-year low hit two years ago.
U.S. export numbers are falling. Farmers leaned into a robust export market in recent years to help soak up bumper harvests, but the latest WASDE includes a red flag: USDA forecast 2026-27 corn exports at 3.15 billion bushels, down 150 million bushels from a record 3.3 billion bushels this year. Could export demand be topping out?
U.S. corn exports are nearly double those of 2022-23, rising at an average of 33% a year over the past three years. That’s simply not sustainable, especially with South America ramping up production. U.S. exports likely won’t fall off a cliff, but slower growth would underscore the need to expand domestic biofuels demand, through E15 gasoline and other fuels, and maintain strong ethanol exports.