Corn Prices Rally Amid Lower Yields and Dry Conditions

U.S. corn futures reached $5 to $5.40 per bushel in late August, a nearly 25% gain during July and August, driven by concerns over lower 2026 yields.

The market has been volatile, with some indicators suggesting overbought conditions, but the next USDA crop estimates, harvest results, and demand figures will determine whether prices can extend their rally or lose momentum.

Current crop health indicators are mixed, with Vegetation Health Index readings 5% below 2025 levels, while USDA Crop Progress data shows a decline in good to excellent corn ratings.

Weather remains another major factor, with around 27% of the U.S. corn crop exposed to dry conditions, compared to only 5% at the same point last year.