Due to the good yield potential in some areas of the Upper Midwest, the number of corn and soybean producers that qualify for 2026 crop insurance indemnity payments may be limited. However, in other portions of the region that are dealing with severe or extreme drought, or have dealt with excessive rainfall and severe storms, crop insurance payments may be more prevalent. Due to likely higher Fall harvest prices for corn and soybeans, compared to the Spring base prices, any 2026 crop insurance indemnity payments will likely be solely based on reductions in crop yield, rather than on a combination of yield reduction and price decline. 
With Federal Crop Insurance, every year is different, and with the multiple options available to producers, there are many variable results from crop insurance coverage at harvest time. The 2026 crop year will be no different, with some producers choosing Yield Protection (YP) policies (yield only) versus Revenue Protection (RP) policies (yield and price), and producers having different levels of coverage on various crops. Producers also vary on having “optional units” versus “enterprise units” for their crop insurance coverage. In addition, some producers also have enhanced insurance coverage through private insurance companies, or through the “Supplemental Crop Option” (SCO) and “Enhanced Coverage Option” (ECO) policies that were available this year. 
In the Midwest, most corn and soybean producers in recent years have tended to secure some level of revenue (RP) crop insurance coverage, rather than standard yield-only (YP) policies. Farm operators like the flexibility of the RP policies that provide insurance coverage for reduced yields, as well as in instances where the harvest price drops below initial base price. In 2026, crop insurance loss calculations for corn and soybeans with RP policies will likely function similarly, due to the harvest price for corn and soybeans being higher than the 2026 crop insurance Spring base prices, which were finalized on March 1. 
The established crop insurance Spring base prices for 2026 YP and RP crop insurance policies are $4.62 per bushel for corn and $11.09 per bushel for soybeans. These base prices will determine potential payment eligibility and amount for 2026 YP policies for corn and soybeans. These base prices will also serve as the final price to calculate revenue guarantees for determining potential RP crop insurance indemnity payments for corn and soybeans, if the harvest price is lower than the base price. If the harvest price is higher than the base price, the harvest price will be used to calculate crop insurance payment potential for RP policies with harvest price protection. 
The final harvest price for RP crop insurance policies is based on the average Chicago Board of Trade (CBOT) price for December corn futures and CBOT November soybean futures during the month of October, with prices finalized on November 1, 2026. If the final CBOT price for December corn futures or November soybean futures is higher than the established base prices, the harvest price would then be used to determine the insurance guarantees for RP policies with harvest price protection, as opposed to the base price. The harvest price is also used to calculate the value of the actual harvested bushels for all RP insurance policies. As of September 25, the crop insurance harvest price estimates were near $5.26 per bushel for corn and $13.20 per bushel for soybeans. 
The level of RP insurance coverage can result in some producers receiving crop insurance indemnity payments, while other producers receive no payments, even though both producers had the same adjusted APH yield and the same final yield. For example, at an adjusted APH corn yield of 200 bushels per acre, and an adjusted price guarantee of 5.26 per bushel, a producer with 85% RP coverage would have a yield guarantee of 170 bushel per acre, and a revenue guarantee of $894 per acre, while a producer with 75% coverage would have a yield guarantee of 150 bushels per acre, and a guarantee of $789 per acre. If the actual 2026 yield is 160 bushels per acre, with a $5.26 per bushel harvest price, the producer with 85% coverage would receive a gross indemnity payment near $53 per acre, while the producer with 75% coverage would not receive an indemnity payment. 
It appears likely that the corn harvest price will exceed the Spring base price of $4.62 per bushel and that the soybean harvest price will exceed the Spring price of $11.09 per bushel. This means that the final harvest price for both corn and soybeans will likely serve as the price guarantee for RP insurance policies that have harvest price protection. This would also result in payment calculations for RP policies functioning very similarly to YP calculations. The only exception being that RP policies with harvest price protection will use the higher corn and soybean harvest price for calculations, rather than the Spring base price that is used for YP policies. If producers have a RPE policy with “harvest price exclusion”, the base revenue is calculated using the Spring price, and the final revenue is calculated using the harvest price. Use of an RPE policy will likely not work very well in 2026 with the current price scenario for corn and soybeans. 
In order to reduce premium costs, a large number of Midwest corn and soybean producers utilize “enterprise units” for their crop insurance coverage, which combines all acres of a crop in a given county into one crop insurance unit. By comparison, “optional units” allow producers to insure crops separately in each township section. Enterprise units work quite well with RP policies to protect against price drops during the growing season, and when a producer has most of their land in the same general area. Optional units are usually preferable when a producer has a variety of land that is spread across a wide area in a county, or when producers have individual farms that are highly susceptible to natural disasters, such as flooding, drought, etc. 
For example …… assume that producers A and B both have 5 separate farms in the same county with an APH corn yield of 200 bushels per acre, and that the overall average 2026 corn yield on all farms was 180 bushels per acre. However, three of the farms were 200 bushels per acre each, and the other two farms were 150 bushels per acre each. Also assume a final corn harvest price of $5.26 per bushel. Producer A has an 85% RP policy with optional units and producer B has an 85% RP policy with enterprise units. Producer A, with the optional units, would receive no insurance payment on the three farms with the higher yield; however, that farmer would receive a gross indemnity payment of $105 per acre on the two farms with the lower yield. Producer B with the enterprise units would receive no insurance payments on any farms, based on the average yield for all farms. 
Many farmers carried expanded Supplemental Crop Option (SCO) and Enhanced Coverage Option (ECO crop insurance coverage in 2026. SCO and ECO crop insurance policies utilize the same Spring price and harvest price as individual crop insurance policies; however, SCO and ECO indemnity payments are based on the final 2026 county average yields compared to the established average county yields. As a result, it could be possible for a producer not to qualify for a crop insurance indemnity payment on an individual policy, but still qualify for a SCO or ECO payment, or vice versa to qualify for an individual insurance payment, but not qualify for a SCO or ECO payment. Any ECO or ECO indemnity payments will not be paid until June, 2027. 
Producers that have crop revenue losses in 2026, which could result in potential crop insurance indemnity payments, should properly document the yield losses, regardless of their type or level of insurance coverage. A reputable crop insurance agent is the best source of information to make estimates for potential 2026 crop insurance indemnity payments, and to find out about documentation requirements for crop insurance losses. Farm operators that collect very large indemnity payments should be aware that they may be subject to an audit by the USDA Risk Management Agency (RMA), which may require more detailed documentation of losses. It is important for producers who are facing crop losses in 2026 to understand their crop insurance coverage and the calculations used to determine crop insurance indemnity payments. 
Kent Thiesse has prepared an Information Sheet titled “2026 Crop Insurance Payment Potential”, which is available by contacting: [email protected]. The University of Illinois FarmDoc web site also contains some good crop insurance information and spreadsheets to estimate crop insurance payments. The FarmDoc web site is located at: https://farmdoc.illinois.edu/crop-insurance. 
For additional information contact Kent Thiesse, Farm Management Analyst Phone - (507) 381-7960; E-mail - [email protected]

USDA will announce the final 2025 market year average (MYA) prices for corn and soybeans on September 30, 2026. These are the MYA prices that will be used to calculate the Price Loss Coverage (PLC) and Ag Risk Coverage (ARC-CO) farm program payments for the 2025 crop year. The 2025 market year for corn and soybeans ran from September 1, 2025 through August 31, 2026, with the MYA price finalized on September 30. The monthly average prices are “weighted”, based on the percentage of bushels sold each month, in order to arrive at a final MYA price for the marketing year. Based on the USDA World Supply and Demand (WASDE) Report that was released on September 11, the current 2025 MYA price estimate for corn is $4.15 per bushel, which has been consistent for several months. The September MYA price estimate for soybeans is $10.50 per bushel, which was increased by $.10 per bushel in the September WASDE Report. 

The final MYA prices for corn and soybeans usually do not vary significantly from the September WASDE Report; however, even a change of a few cents per bushel can significantly impact the final farm program payment. For example, if the final MYA corn price increases by $.02 per bushel from the current $4.15 per bushel to $4.17 per bushel, the estimated PLC payment would decrease by approximately $2.72 per corn base acre on a farm that has a farm-level PLC yield of 160 bushels per acre. If the farm had 1,000 corn base acres, that would be a total reduction of $2,720 from the September WASDE Report estimates. Of course, a decrease in the final MYA price to $4.13 per bushel would have a similar positive impact on the final PLC payment. The increase in the estimated soybean MYA price of $.10 per bushel in the September 11th WASDE Report reduced the PLC payment estimate by $4.25 per soybean base acre from the previous estimate. On a farm with a 50 bushel per acre PLC yield, the PLC payment reduction would be a total of $4,250 of a farm with 1,000 soybean base acres.  

The changes in the MYA prices have a similar impact of final ARC-CO payments. If the final MYA corn price increases by $.02 per bushel to $4.17 per bushel, it will reduce the estimated ARC-CO payment by $3 to $4 per corn base acre in any county that is scheduled to receive ARC-CO payments rather than PLC payments. The increase of $.10 per bushel in the estimated soybean MYA price would reduce the estimated ARC-CO payment by $4 to $5 per base acre in many counties. For counties scheduled to receive the maximum corn or soybean ARC-CO payment in 2025, any potential changes in the final MYA price may not impact the final ARC-CO payments. The impact on ARC-CO payments will vary depending on the final 2025 county average yield compared to the 2025 benchmark yield for a given county. 

For the 2025 crop year only, eligible producers will get the higher of the calculated 2025 PLC or ARC-CO payments for corn, soybeans, wheat, and other program crops. This provision means that it is likely that all eligible base acres of corn, soybean, wheat, and many other crops are likely to receive either a PLC or ARC-CO payment for the 2025 crop year. The 2025 PLC or ARC-CO payments for all farm program crops will be paid in October, 2026. These PLC and ARC-CO payments will be automatically calculated by Farm Service Agency (FSA) offices and will be deposited into appropriate accounts. The provision allowing the higher of PLC or ARC-CO payments will only be in effect for the 2025 crop year. 

All farm program payments are paid on 85 percent of crop base acres, so any calculated payments per acre need to be factored by .85 to arrive at an estimated payment per base acre. All farm program payments are paid on crop base acres, and not on 2025 planted acres. It should be pointed out that there will be a 5.7 percent Federal sequestration reduction applied to all farm program payments, so the gross payment amount on a farm unit needs to be multiplied by (.943) to arrive at the net farm program payment. County Farm Service Agency (FSA) offices provide information on farm-level PLC program yields and other farm program details; however, Information on benchmark yields, prices and revenues, and other farm program information is available on the USDA ARC-PLC web site at:  www.fsa.usda.gov/arc-plc. 

Following is the current update on likely 2025 PLC or ARC-CO payments for Corn and Soybeans:
Corn --- All eligible corn producers will likely receive a significant 2025 farm program payment. Based on the September WASDE report, the estimated 2025 MYA corn price is $4.15 per bushel. The estimated MYA price is $.27 per bushel below the 2025 PLC reference price of $4.42 per bushel, and is $.88 per bushel below the 2025 benchmark price of $5.03 per bushel for ARC-CO payments. At a final MYA price of $4.15 per bushel, the estimated 2025 PLC payment would be about $35 to $40 per corn base acre on farms with a PLC program yield of 150-170 per acre, $30-$35 per base acre with a PLC yield of 130-150 bushels per acre, and $25-$30 per base acre with a PLC yield of 110 to 130 bushels per acre. At the current 2025 MYA price, potential 2025 ARC-CO payments would be initiated with a final county average corn yield that is about 8-10 percent above the 2025 benchmark yield, and ARC-CO payments will likely exceed PLC payments at a final county yield that is about 4 percent or less above the county benchmark yield. The maximum corn ARC-CO payment would occur at a final average yield that is about 5-6 percent lower than the county benchmark yield. The likelihood of receiving either a PLC or an ARC-CO payments for corn will be highly variable from county-to-county across the Midwest, due to the wide variation in 2025 final county average corn yields.
Soybeans --- Similar to corn, it is likely that eligible soybean producers will receive a 2025 farm program payment.; however, it is likely to be considerably lower than the corn payment in most counties. Based on the September WASDE report, the estimated 2025 MYA soybean price is estimated at $10.50 per bushel. The estimated MYA price would be $.21 per bushel below the 2025 PLC soybean reference price of $10.71 per bushel, and would be $1.67 per bushel lower than the 2025 benchmark price of $12.17 per bushel. At a final MYA price of $10.50 per bushel, the estimated 2025 PLC payment would be $9 to $11 per soybean base acre in counties with a 50-60 bu. per acre PLC yield, $7 to $9 per base acre in counties with a 40 to 50 bu. per acre PLC yield, and $5 to $7 per base acre in counties with a 30 to 40 bu. per acre PLC yield. At the current MYA price estimate, 2025 ARC-CO payments would be initiated with a final 2025 county average soybean yield that is about 4 percent above the 2025 county benchmark yield, and ARC-CO payments will likely exceed PLC payments at about 2 percent above the county benchmark yield. The maximum soybean ARC-CO payment would occur at a final average yield that is about 9 percent lower than the county benchmark yield. 
PLC and ARC-CO Payment Summary --- As previously mentioned, the 12-month 2025 marketing year for corn and soybeans ended August 31, 2026, with the MYA prices to be finalized on September 30, 2026. Kent Thiesse, Farm Management Analyst, has prepared a set of tables listing the likely PLC or ARC-CO payment for corn and soybeans in every county in Minnesota. To receive copy of these tables, or for other specific questions on 2025 farm program payments, contact Kent Thiesse at: [email protected]

USDA Announces 2026 and 2027 Farm Program Sign-Up Dates 
USDA has announced the sign-up dates for both the 2026 and 2027 farm programs at County FSA offices. The farm program sign-up dates for the 2026 crop year began on September 16 and will continue until December 11. Farm program sign-up for the 2027 crop year will begin on November 2, 2026 and will continue until March 15, 2027, which coincides with the 2027 crop insurance deadline for corn, soybeans, and other Spring crops. It is important to note that all producers will need to sign-up for the 2026 farm program, in order to be eligible for potential 2026 farm program payments, which would likely be paid in October, 2027. The 30 million crop base acres that were added earlier this year will be included for potential 2026 and 2027 farm program payments.

For both the 2026 and 2027 farm programs, farmers will again need to choose between price-only PLC program, and the ARC-CO program, which is based on the market-year average (MYA) price and county average yields. The ARC-IC program provides a third farm program choice, which is based on the same MYA price and farm-level yields; however, ARC-IC also has other provisions that are different from PLC and ARC-CO. Final 2026 county average yields and farm-level yields will likely impact final 2026 farm program choices in many instances More information on the 2026 and 2027 farm program choices will be available in the coming weeks.
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For additional information contact Kent Thiesse, Farm Management Analyst
Phone --- (507) 381-7960; E-mail --- [email protected]  

The September 11 USDA National Ag Statistics Service (NASS) Crop Report lowered the projected 2026 U.S. average yield for corn from the August estimate; however, USDA slightly increased the 2026 soybean yield projection. USDA also indicated a slight increase the expected 2026 harvested acreage for both corn and soybeans in the September report from earlier reports. The end result was a decrease of just over 200 million bushels from the August report in the estimated overall 2026 U.S. corn production level as opposed to a slight increase in the total 2026 soybean production total. The latest NASS yield estimates were based on U.S. crop conditions as of September 1st; and were the first 2026 USDA yield estimates that included actual field data. Some grain marketing analysts feel that the USDA corn yield and production estimates may still be a bit high, given the drought conditions in a significant portion of the Western Corn Belt that will likely reduce the final 2026 corn yields.
The September 11 USDA Report projects the 2026 U.S. average corn yield at the record level of 178.5 bushels per acre, which was decreased from 180.7 bushels per acre in the August report. The projected 2026 national corn yield compares to last year’s record U.S. yield of 186.5 bushels per acre in 2025, 179. 3 bushels per acre in 2024, 177.3 bushels per acre in 2023, 173.3 bushels per acre in 2022, and 177 bushels per acre in 2021. A year ago, USDA estimated the average corn yield at 186.7 bushels per acre in the September report, which was very close to the final average corn yield of 186.5 bushels er acre. In the recent report, USDA estimated the 2026 harvested corn acreage in the U.S. at 88.5 million acres, which included estimates from crop acreage certification data filed by producers through the USDA Farm Service Agency (FSA) offices. This compares to 91.3 million acres in 2025 and 83 million harvested acres in 2024. USDA is now estimating total U.S. corn production for 2026 at 15.8 billion bushels, which would be a 7.2 percent decrease from the 2025 record production level of just over 17 billion bushels.
The September corn yield estimates were reduced from the August USDA yield estimates in all major corn producing States except Iowa and Missouri. USDA is estimating Minnesota’s 2026 average corn yield at 195 bushels per acre, which is a decrease of 2 bushels per acre from the August estimate. The projected 2026 corn yield compares to the record average yield of 201 bushels per acre in 2025, 174 bushels per acre in 2024, 185 bushels per acre, in 2023, and 195 bushels per acre in 2022. The latest NASS report increased Iowa’s projected 2026 average corn yield by 3 bushels per acre to 219 bushels per acre, which would l be a record statewide average yield. This compares to final average yields of 210 bushels per acre in 2025, 211 bushels per acre in 2024, 201 bushels per acre in 2023, and 200 bushels per acre in 2022.
USDA is projecting Illinois to have a 2026 corn yield of 209 bushels per acre, compared to 214 bushels per acre in 2025; Indiana at 200 bushels per acre, compared to 204 bushels per acre in 2025; Nebraska at 177 bushels per acre, compared to 194 bushels per acre in 2025; and South Dakota at 145 bushels per acre, compared to 171 bushels per acre in 2025. The 2025 corn yield estimates in some other States include, North Dakota at 130 bushels per acre, compared to 158 bushels per acre in 2025; Wisconsin at 180 bushels per acre, compared to 188 bushels per acre in 2025; and Ohio at 194 bushels per acre, compared to 185 bushels per acre in 2025.
The USDA Report on September 11 estimated total 2026 U.S. soybean production at just over 4.53 billion bushels, which would be an increase of 6.4 percent from the 2025 soybean production of just under 4.26 billion bushels. USDA projected the 2026 U.S. average soybean yield at 52.8 bushels per acre, which was increased by 0.1 bushels per acre from the August report. The 2026 NASS soybean yield estimate was just under the record U.S. soybean yield of 53 bushels per acre in 2025,and compares to yields of 50.7 bushels per acre in 2024, 50.6 bushels per acre in 2023, 49.5 bushels per acre in 2022, and 51.4 bushels per acre in 2021. The USDA 2025 soybean yield projection was very close to the average yield estimates by grain trading analysts.
USDA is estimating Minnesota’s 2026 average soybean yield at 49 bushels per acre, which was increased by one bushel from the August estimate. The 2026 yield projection compares to the record-tying yield of 52.5 bushels per acre in 2025, and other recent statewide yields of 45 bushels per acre in 2024, 48 bushels per acre in 2023, 50 bushels per acre in 2022, and 47 bushels per acre in 2021. The Iowa’s estimated 2026 soybean yield is at the record level of 64 bushels per acre, which is up by 2 bushels per acre from the August estimate. The 2026 estimated yield compares to last year’s record yield of 63.5 bushels per acre, as well as 60 bushels per acre in 2024, 58 bushels per acre in 2023, 58.5 bushels per acre in 2022, and 62 bushels per acre in 2021.
The projected 2026 yields in major soybean producing eastern Corn Belt States include Illinois at 66 bushels per acre, compared to 62.5 bushels per acre in 2025; Indiana at 63 bushels per acre, compared to 59,5 bushels per acre in 2025; and Ohio at 59 bushels per acre, compared to 53 bushels per acre in 2025. Most soybean yields in the Western Corn Belt States are expected to decrease from 2025 yield levels. Soybean yield estimates for 2026 include Nebraska at 60 bushels per acre, compared to 65.5 bushels per acre in 2025; South Dakota at 42 bushels per acre, compared to 47 bushels per acre in 2025; North Dakota at 30 bushels per acre, compared to 34.5 bushels per acre in 2025, and Wisconsin at 55 bushels per acre, compared to 56 bushels per acre in 2025.
 
SEPTEMBER 11 WASDE REPORT
The USDA World Supply and Demand Estimates (WASDE) was also released on September 11, which included the projected adjustments in the 2026 U.S. corn yield and production levels that were referenced in the USDA Crop Production Report. The WASDE report projects a reduction in the corn usage levels during 2026-27 marketing year, as compared to the 2025-26 corn usage levels. Corn use for livestock feed is expected to decrease by 405 million bushels in 2026-27; however, corn use for ethanol is projected to increase by 50 million bushels. U.S. corn export levels for 2026-27 are estimated at 3.275 billion bushels, which is down from the estimate of 3.425 billion bushels for 2025-26. Corn export levels have been fairly strong in recent months.
The U.S. corn ending stocks for 2026-27 are projected at 1.567 billion bushels, which would be a decrease of 18.5 percent or 355 million bushels percent from the estimated 2025-26 carryover level. The latest 2026-27 corn ending stocks projection compares to other final corn carryover levels of 1.55 billion bushels in 2024-25, 1.76 billion bushels in 2023-24, 1.36 billion bushels in 2022-23, and 1.38 billion bushels in 2021-22.
The reduced level of the projected 2026-27 corn carryover has created some optimism for corn price prospects for the 2026-27 marketing year, which extends from September 1, 2026, through August 31, 2027. USDA is estimating the average on-farm corn price for the 2026-27 marketing year at $4.80 per bushel, which is increase by $.30 per bushel from the August report. The 2025-26 national average corn price, which will be finalized on September 30, 2026, is estimated at $4.15 per bushel. This compares to previous final average prices of $4.24 per bushel in 2024-25, $4.55 per bushel in 2023-24, $6.54 per bushel in 2022-23, and $6.00 per bushel in 2021-22.
The recent WASDE report projected 2026-27 soybean ending stocks at 310 million bushels, which was a decrease of 10 million bushels from the August estimate. The 2026-27 estimated soybean ending stocks are lower than the final ending stocks of 325 million bushels in both 2025-26 and 2024-25. Other recent soybean ending stocks levels include 342 million bushels in 2023-24, 264 million bushels for 2022-23 and 274 million bushels in 2021-22. Soybean exports for 2026-27 are projected at 1.685 billion bushels, which would be an increase from the estimated 1.52 billion bushels for 2025-26, but would still trail 1.89 billion bushels of exports in 2024-25. Recent soybean sales to China have improved soybean export prospects for the coming year.
USDA is projecting the average on-farm soybean price for the 2026-27 marketing year at $12.00 per bushel, which is up $.60 per bushel from the August price estimate. The 2025-26 estimated final national average soybean price is $10.50 per bushel, which compares to national average prices of $10.00 per bushel in 2024-25, $12.40 per bushel in 2023-24, $14.20 per bushel in 2022-23, and $13.30 per bushel in 2021-22.
For additional information contact Kent Thiesse, Farm Management Analyst Phone --- (507) 381-7960; E-mail --- [email protected]

The late Summer of 2026 has seen some rather dramatic increases in the Chicago Board of Trade (CBOT) grain futures prices, as well as with cash market prices at the local level. This increase in the cash corn and soybean prices has provided an unexpected surprise to farmers that still had some of their 2025 in storage to sell prior to the 2026 harvest, as cash prices are typically at their lowest levels from July until late Fall. A majority of farm operators had already sold all or most of their 2025 corn and soybeans in storage prior to the August rally in the grain markets. All farmers do have the opportunity to take advantage of the higher grain prices to “lock-in” a price on a portion of their anticipated 2026 corn and soybean production; however, reduced crop production may limit these marketing opportunities in some areas.
 
December corn futures on the CBOT increased from $4.64 per bushel on July 31, 2026 to $5.38 per bushel on August 31, 2026, which is about a 16 percent increase during the month of August. This is the largest percentage increase in the CBOT December corn futures price ever recorded since 1980 from the end of July until the end of August. During that 46-year period, the December corn futures have increased by 5 percent or more in ten years during the month of August, with 2022 being the most recent year prior to 2026. The December futures price has increased by 10 percent or more in only three years, prior to 2026, with those years being 2011, 2003, and 1983, all of which were associated with reduced corn production. By contrast, the December corn futures price has declined by 5 percent or more 5 times in the past ten years (2016-2025) prior to 2026.  
 
The CBOT December corn futures price of $5.38 per bushel on August 31, 2026 was comparable to the late August CBOT prices of $5.30 per bushel in 2022 and $5.34 per bushel in 2021. However, the current corn price far exceeds the last August CBOT corn prices of $4.20 per bushel in 2025, $4.01 per bushel in 2024, $4.80 per bushel in 2023, and $3.57 per bushel in 2020. The CBOT December corn futures price started the year near $4.50 per bushels, reaching a high near $5.00 per bushel in mid-May, which was the highest price in 2026 prior to the August rally in the corn market. The corn futures price was as low as $4.36 per bushel as recently as June 30.
 
The increase in the December corn futures price is large being driven by concerns over expected 2026 U.S. corn production levels. The USDA crop production report lowered the projected 2026 U.S. average corn yield from 183 bushels per acre in July to 180.7 bushels per acre in August. Some private analysts have estimated the final 2026 U.S. corn yield in the 174 to 178 bushel per acre range. The next USDA crop report, which will be released on September 11, will include data based on actual field samples. There will be considerable attention paid to this report, regarding further USDA reductions in 2026 U.S. corn yield and production estimates.
 
Several portions of eastern Corn Belt have been impacted by excessive rainfall at certain times during the 2026 growing season, along with the development of corn and soybean fungal diseases later in the growing season. The corn and soybean crop in large areas of Nebraska, North and South Dakota, along with western Minnesota and Iowa have been impacted by intensifying drought conditions in late July and August, which will likely reduce the yield potential in many areas. The latest U.S. Drought Monitor, released on September 3, showed that nearly 80 percent of Minnesota was in moderate drought, with over half of the State in severe drought. The drought situation was similar in North and South Dakota, Nebraska, and Wisconsin, as well in Western Iowa.
 
The CBOT November soybean futures price has also increased considerably in recent months. The 2026 November futures price has risen by 13.5 percent in the past three months, rising from a price of $11.34 per bushel in mid-June to $12.88 per bushel at the end of August. The November futures price started the year near $10.65 per bushel, reaching a high near $11.90 per bushel in late May, prior to the significant price increase that has occurred in late July and August. In addition to increasing drought in portions of the U.S. and the potential for reduced  production in 2026, the recent rise in soybean prices is also being driven improving demand for soybeans, both in the domestic crush markets and in export markets to China and other countries.
 
 
Basis  Levels  Affect Local Grain  Prices
The basis level at a given location can have a big impact on the “net price” that a farmer receives for their corn or soybeans. On any given day, farm operators and others can get grain price quotes from the CME Group, also known as the Chicago Board of Trade (CBOT), in “real-time” on their computer or I-phone. Almost as quickly, they can get current and future corn and soybean market price quotes from local grain elevators, ethanol plants, and processing plants. The difference between the local grain price and the CBOT price is known as “basis”.
 
More specifically, “basis” is the difference between the local grain price quote on a specific date and the CBOT price for the corresponding futures contract month. Local harvest price quotes for corn and soybeans would correspond to the December CBOT corn futures price and the November CBOT soybean futures price. By comparison, storing the corn or soybeans after harvest and selling the grain via a forward contract in June or early July the following Summer would have the basis level determined by the July CBOT corn or soybean futures.
 
The current 2026 basis levels for corn and soybeans in Southern Minnesota have been quite wide in recent months.  Recent 2026 harvest basis levels for corn in much of the Upper Midwest ranged from about $40 to $.60 per bushel under the CBOT December corn futures price, with basis levels in much of North & South Dakota and Northwest Minnesota exceeding $.70 per bushel. Soybean basis levels ranged from about $.40 to $.70 per bushel under the CBOT price in much of Iowa, Southern Minnesota and Wisconsin, eastern South Dakota and eastern Nebraska. Fall harvest basis levels are $.75 per higher at many locations in the balance of South Dakota and Nebraska, the northern half of Minnesota and Wisconsin, and all of North Dakota. Basis levels are slightly tighter near corn and soybean processing plants in some areas, as well as near primary shipping locations on the Mississippi River.
 
There are many grain marketing tools available for farm operators to utilize in addition to cash sales, including a variety of hedging, options, and basis contracts. Generally, a hedging or options contract locks in the CBOT futures price, but not the cash price, meaning that the farmer still has basis risk. For example, a “hedge-to-arrive” contract locks in a CBOT futures price but does not finalize the basis until the futures contract is cleared and the grain is actually delivered and sold at the local level. The hope is that the basis level will narrow or improve by the time that the grain is delivered to market and a final cash price is determined. By comparison, a “basis contract” locks in the basis level, but keeps the final price open depending on changes in the corresponding CBOT futures price at the time of delivery, or when setting the final price.
 
The wider “harvest-time” basis levels for corn and soybeans during harvest season this year is  something to factor into post-harvest grain marketing decisions in the next few months. If corn and soybean futures prices continue to rally in the coming weeks and basis levels remain quite wide, it will likely encourage the use of more “hedge-to-arrive” contracts for the summer months of 2027. This will allow producers to reduce their “price risk” on the stored grain, while still being able to take advantage of potential basis improvement that may occur between the post-harvest months and the Summer of 2027. On the other hand, if localized basis levels tighten for a short-term period of time after harvest due to disappointing 2026 crop yields and strong local demand, it may be a time to sell the grain in the cash market or to use a “basis contract” to lock-in the basis level, and still have some upside potential in the corn or soybean market into next Spring.
 
Most grain marketing strategies, including storing unpriced grain in a bin on the farm, involve some level of price and/or basis risk. Understanding the dynamics of basis in corn and soybean market prices is a key element in analyzing the various types of grain marketing contracts that are available to farm operators. Many grain marketing advisors do a very good job of explaining the dynamics of basis and how that interacts with grain marketing strategies. Iowa State University has some good information available on understanding basis and explaining various grain marketing strategies. This information is available on the “Ag Decision Maker” website at: https://www.extension.iastate.edu/agdm/cdmarkets.html.
 
For additional information contact Kent Thiesse, Farm Management Analyst
Phone - (507) 381-7960; E-mail - [email protected] 

As farmers prepare for the 2026 harvest season, the use of Marketing Assistance Loans (MAL’s) may take on more significance in setting up post-harvest grain marketing and cash flow plans for corn and soybeans. Commodity Credit Corporation (CCC) commodity loans on harvested corn, soybeans and wheat were regularly used by farm operators in the 1990’s and early 2000’s, as well as from 2015 to 2019, as a grain marketing tool. The use of CCC commodity loans dropped off considerably from 2008-2014 and again from 2020-2023, when grain prices reached their highest levels in many years.  This year’s uncertainty in the current corn and soybean markets could make the use of MAL’s a viable option to allow more time for marketing decisions.
 
The Marketing Assistance Loans (MAL’s) are originated through county Farm Service Agency (FSA) offices after the grain has been harvested and are 9-month loans from the time of origination. A marketing assistance loan can be established both on farm stored grain and on grain in commercial storage with a warehouse receipt. Producers receive the value of the loan at the time the MAL loan is established. The loan can be repaid at any time during the 9-month loan period, by repaying the amount of the loan principal plus the accrued interest.
 
The MAL loan interest rate is adjusted monthly and is set up at one percent above the CCC borrowing rate from the U.S. Treasury. The interest rate on MAL loans is fixed for the entire term of the 9-month MAL, except for a potential CCC interest rate adjustment on January 1. The current interest rate on marketing assistance loans (as of 8-01-26) is 4.875 percent, which compares to an interest rate of 7.5 to 9 percent for short-term financing at many commercial ag lending institutions. Producers only pay interest for the time that the MAL is in place. (For example, a $500,000 MAL corn loan at 4.875 percent interest for 180 days = $12,187 interest payment for 6 months, which compares to $20,000 on a similar loan at 8 percent interest for 180 days).
 
Farm operators have the flexibility to place grain under a MAL at a local FSA office any time after the grain has been harvested, so they could take out the MAL in November or December, 2026, or wait until after January 1, 2027. Producers also have the flexibility to treat the commodity loan as either “income” or as a “loan” when the loan proceeds are received. Either of these decisions can have income tax implications, depending on how and when the loan proceeds are received. It is best to consult with a tax advisor before determining the timing and the preferred method of receiving the loan proceeds.
 
If commodity prices drop to levels that are lower than county loan rates, eligible producers would potentially be eligible to release the grain that is under a marketing assistance loan at a rate that is lower than the county loan rate. FSA issues a “posted county price” (PCP) for commodities that are eligible for MAL’s, which are updated and posted daily at local FSA offices, or available on county FSA websites. If the PCP is lower than the county loan rate, the producer could realize a “marketing loan gain” (MLG), if the grain is released at that lower PCP. (Example --- a producer places corn under a MAL at $2.35 per bushel, a few months later the PCP is $2.10 per bushel, resulting in the potential of a marketing loan gain of $.25 per bushel on the day the corn loan is released.) If the PCP drops below the county MAL loan rate, producers also have the option to collect a loan deficiency payment (LDP) on a commodity, in lieu of putting the grain under a commodity loan. The LDP calculation is similar to the calculation for marketing loan gains. A LDP can only be utilized once on the same bushels of grain. There has not been significant LDP eligibility for corn and soybeans since the early 2000’s and we do not anticipate any LDP opportunities for the 2026 corn and soybean crop.
 
Producers must be eligible for farm program benefits and must have submitted an acreage report at the FSA office for 2026 to be eligible for MAL’s for this year’s crop production. Producers must maintain “beneficial interest” in the grain while it is under a MAL. Beneficial interest means that the producer maintains control and title of the commodity while it is under a commodity loan. Farmers should contact their local FSA office to release any grain that is under a marketing assistance loan before it is delivered to market (“call before you haul”).
 
The Reconciliation Bill by Congress in 2025 increased all national loan rates by 10 percent for the 2026 crop year.  Following are the 2026 MAL national loan rates for common crops in the Upper Midwest:

• Corn --------   $2.42 per bushel.
• Soybeans ---  $6.82 per bushel 
• Wheat ------- $3.72 per bushel 
• Barley ------- $2.75 per bushel   
• Oats ---------  $2.20 per bushel 
• Grain Sorghum --- $2.42 per bushel 

 
The county loan rates are then adjusted higher or lower than national rates, based on local commodity price differentials compared to national price levels. Following is the range of 2026 County corn and soybean loan rates for MAL’s for States in the Upper Midwest States:

• Minnesota --------  Corn = $2.24 to $2.36/bu.;  Soybeans = $6.47 to $6.78/bu.
• Iowa ---------------  Corn = $2.30 to $2.49/bu.;  Soybeans = $6.70 to $6.94/bu.
• Nebraska ----------  Corn = $2.27 to $2.50/bu.;  Soybeans = $6.43 to $6.79/bu.
• South Dakota -----  Corn = $2.27 to $2.43/bu.;  Soybeans = $6.32 to $6.75/bu.
• North Dakota -----  Corn = $2.22 to $2.43/bu.;  Soybeans = $6.32 to $6.62/bu.
• Wisconsin ---------  Corn = $2.27 to $2.44/bu.;  Soybeans = $6.70 to $6.89/bu.

County loan rates for all crops in every U.S. County are available on the following FSA website: www.fsa.usda.gov/resources/price-support/commodity-loan-rates
 
Following are some reasons that farm operators may want to consider utilizing marketing assistance loans (MAL’s) as part of their grain marketing and cash flow strategies:

• Provides short-term credit at relatively low and stable interest rates.
• Loan funds can be used to pay post-harvest expenses and land rental payments for the current year or for prepaid crop inputs (seed, fertilizer, etc.) for the following crop year.
• Loan funds can also provide the necessary funds to make year-end or January principal and interest payments on term loans and real estate loans.
• Allows a producer to receive partial compensation for corn and soybeans during or following the Fall harvest season, when commodity prices are traditionally lower than average.
• Allows a producer the flexibility to market the grain in future months after the grain has been placed under a MAL, including forward pricing the grain for future delivery (remember that the commodity loan must be satisfied at the FSA office before the grain is delivered.)
• Commodity loans can also be used by livestock producers that plan to feed the corn or other grain, which is followed by just releasing the grain that is under loan as it is fed to livestock.
• If commodity prices decline below the county CCC loan rates, the grain that is under loan can be released at the lower price, or producers can collect a loan deficiency payment (LDP).

 
In Minnesota, FSA offices file a Central Notification System (CNS) form with the Minnesota Secretary of State Office on all grain used as security for a marketing assistance loan. These forms are similar to the CNS forms that are filed by ag lenders for farm operating loans to guarantee the transfer of funds when grain or livestock is sold to cover outstanding loan balances.
 
For further information on USDA marketing assistance loans (MAL’s) and county loan rates for various commodities, farm operators should contact their local FSA office, or go to the following website:
https://www.fsa.usda.gov/resources/loans/marketing-assistance-loans-mal
 
 
For additional information contact Kent Thiesse, Farm Management Analyst
Phone --- (507) 381-7960; E-mail --- [email protected]