USDA’s first monthly estimates of production Aug. 12 brought clarity to corn and soybeans, but the government’s vision likely isn’t appealing to farmers wondering if they can make a profit on this year’s crops.

While the new crop year doesn’t officially begin for two more weeks, the latest WASDE suggests last week’s plunge to new contract lows puts the burden of proof squarely on the shoulders of bulls to prove the market wrong. Otherwise, rallies could be fleeting opportunities – and not very good ones at that.

Though it’s always darkest before the dawn, the sun is rising later and later these days. Turning futures around isn’t impossible, but may pose a strong challenge.

50 days of corn

So, let’s get the bad news out of the way by starting with corn. USDA’s first surveys of farmers and their fields put yields at 183.1 bushels per acre, with production at 15.147 billion bushels – not a record but close to it. By the government’s math that would take stocks left over at the end of the marketing year Aug. 31, 2025, to 2.073 billion bushels, a supply of more than 50 days that would be a 20-year high.

Cash prices would average $4.20 under this scenario, 13% below the average cost of production. My price model puts the top one-third of the futures range for the crop at $4.10 to $4.44. The September 2025 contract closed the week at $4.28¾, providing only limited upside potential.

That’s not the worst of it. What if a big crop gets bigger? My most bearish estimate would take yields to 185.1 bpa, adding another 150 million bushels to production. Futures for 2024 crop delivery contracts would fade below $4, with the top third of the expected range $4.04 to $4.35, even assuming cheap corn stimulates record demand.

To be sure, August production estimates could wind up lower – the bottom end of my models’ yield guesses is around 177.2 bpa. If demand holds up, average cash prices could average close to $4.75, enough to take the top-third of the selling range to $4.40 to $4.85, giving futures a little breathing room for rallies, though profitability could still be tough for those with average costs.

Will soybean production increase?

The math for soybeans may be a little more comforting, if only because the bar is quite low indeed.

USDA put the yield at a record 53.2 bpa for a crop of 4.589 billion bushels, raising year-end stocks to 560 million bushels and dropping the average cash price to $10.80. This base case would leave the top-third of the selling range from $12.40 to $13.31. August 2025 futures settled at $10.20¾ last week. That would give the market plenty of room to run – as long as the crop doesn’t get any bigger.

Unfortunately, it could.

Average U.S. yields could rise all the way to 55.7 bpa, adding more than 200 million bushels to production. Even record demand would be hard-pressed to keep average cash prices above $9, taking the top-third of the price range to $10.35 to $11.15. This would limit rallies and make selling rallies a now-or-never proposition.

Weighing demand dynamics

While the supply news is bearish, demand could always be the saving grace for growers needing price protection. Combines may be gearing up to cut fields in the U.S., but planters aren’t even starting to roll yet in the Southern Hemisphere, where weather is always a wild card

How much competitors around the world have to sell should ultimately decide the fate of U.S. corn and soybean exports, and influence usage by livestock feeders and ethanol plants too.

These waters are, of course, muddied by the U.S. election and uncertainty over tariffs, the war on Ukraine, and the value of the dollar, which could remain stubbornly strong. Here are the demand dynamics headed into kick off for the marketing year.

All of that said, as I’ve noted in several recent columns, these August estimates likely will change, perhaps dramatically in coming months. So, if you can sell crops for a profit and can’t take the risk of being bullish, it’s time to take the money and run.