Chicago Corn and Soybeans: A Turnaround Opportunity Amid Multi-Month Lows

Investors in agricultural commodities have weathered a storm over the past two years, with corn and soybean prices plummeting to multi-year lows. Yet, recent technical and fundamental signals suggest a turning point is near. For traders and investors with a long-term horizon, the current juncture presents a compelling entry point for bullish positions in these key commodities. Let's dissect the data.

Technical Rebound Potential: A Shift in Momentum

The technical charts for corn and soybeans are flashing green. Both commodities have rebounded from historic lows, with corn climbing to $4.38 per bushel in early June 2025—up from its 2023 trough of $4.40—and soybeans trading at $10.40¾, a sharp recovery from their July 2024 nadir of $11.10.

Key Technical Indicators:
- RSI (14-day): Both commodities are trading above the oversold threshold of 30, with corn at 45 and soybeans at 42—signaling reduced downward pressure.
- Moving Averages: The 50-day moving average for corn has crossed above the 200-day line (a bullish “golden cross”), while soybeans' 50-day MA is nearing a similar breakout.
- Resistance Levels:
- Corn: Immediate resistance at $4.50 (June 2023 high). A breach could target $5.00.
- Soybeans: Resistance at $11.00, with the next hurdle at $11.50.

Fundamental Dynamics: Supply-Demand Tightening

The technical rebound isn't just a statistical anomaly—it's rooted in shifting fundamentals.

1. US Export Data: A Gradual Turnaround

Despite weak demand in 2023–2024, recent export data hints at stabilization:
- Corn: Weekly sales to Mexico and Japan improved to 741,200 metric tons in mid-June, albeit 18% below year-ago levels.
- Soybeans: Purchases by the Netherlands and Mexico lifted weekly sales to 402,900 metric tons—83% above the four-week average.

2. South American Crop Conditions: Mixed but Favorable

• Brazil: A record soybean harvest of 6.4 billion bushels has pressured global prices, but delays in shipments due to logistical bottlenecks have slowed supply flooding.
• Argentina: Drought-stricken soybean crops (projected to drop 20% from 2023) could tighten global supplies, supporting prices.

3. Ethanol Demand: A Steady Anchor for Corn

US corn consumption for ethanol remains stable at 5.5 billion bushels annually, with renewable diesel demand poised to grow if federal incentives expand. This demand floor limits downside risk.

Investment Strategy: Positioning for a Bull Run

The convergence of technical and fundamental factors suggests a strategic long entry. Here's how to play it:

Entry Points:

• Corn: Buy dips near $4.20, with a stop-loss at $4.00. Target $4.75–$5.00 by year-end.
• Soybeans: Accumulate near $10.00, using $9.80 as a stop-loss. Aim for $11.50 by Q4 2025.

Risk Management:

• Stop-Loss Discipline: Adhere to stops; weather disruptions (e.g., Midwest heatwaves) or a China-US trade deal reversal could trigger selloffs.
• Position Sizing: Allocate 3–5% of a diversified portfolio to these commodities, given their cyclical nature.

Macro Catalysts to Watch:

• USDA Reports (July–August): Yield estimates for 2025/26 crops will dominate sentiment. A yield below 51 bushels/acre for soybeans or 180 bushels/acre for corn could spark rallies.
• Global Weather: Monitor dry conditions in Brazil's soybean belt and US Midwest heat stress during pollination (corn) and pod-filling (soybeans) phases.

Conclusion: The Time to Act Is Now

The combination of oversold technicals, improving export data, and supply-side risks creates a compelling case for long positions in corn and soybeans. While volatility remains, the risk-reward profile tilts heavily bullish for investors willing to ride the recovery. As the old adage goes: “Buy the dip, sell the rip”—and this dip could be the last one for years.

Stay vigilant, but stay long.