Canada Markets
The European Corn Situation Demands Our Attention
8/5/2026 | 7:56 AM CDT
By Mitch Miller, DTN Contributing Canadian Grains Analyst
Feed grain markets in North America will almost certainly be impacted by this summer's record-setting drought in Europe, with the developing situation deserving our attention. And so, we shall give it.
The media has given scorching heat, lack of rainfall and resulting wildfires and damage to crops enough attention that I won't repeat details here. My focus is on the fundamental and technical factors that we should be aware of going forward.
Starting with the fundamentals, the European Commission provided a cereals market situation update on July 30 with significant alterations to its corn projections included. Setting the tone, corn seeded area was cut from 8.2 million hectares (mha) in the June forecast to 7.5 mha due to dry conditions. That left seeded area 11.1% below last year's 8.5 mha and 13.1% below the five-year average, solidifying a drop in production along the way.
Yield was lowered by 6% from last month, taking it to just 3% below last year and 2% below the five-year average. That is significant because it suggests further declines in yield and total production are likely, considering the crop condition declines still being seen.
As of July 27, the French corn crop was rated 34% good to excellent, compared with 84% as recently as mid-June. That is the lowest since records began in 2011, suggesting further declines in yield estimates are likely. A small crop tends to get smaller, being the common theory at play here.
Back to total production -- the European Commission estimated corn production will fall to 51.9 million metric tons (mmt) from 60.2 mmt last year, taking out the 2022 low mark and resulting in the smallest corn crop for the EU since 2007. With that crop being 49.5 mmt, it is certainly feasible that we could see the 2026 version fall below that yet. It is also worth noting that USDA (in its July 10 WASDE update) lowered its European corn production estimate from 57.5 mmt for 2025-26 to 53.78 mmt for 2026-27. Given what has transpired weather-wise since, look for that to fall further in future updates.
In response to the decline in production, the European Commission increased its estimate for corn imports to 24 mmt from 19 mmt last month. That would already take out the 2018 record of 23.6 mmt that we discussed in late June. For comparison, USDA was uncharacteristically aggressive in its July update, increasing the European corn import estimate by 3 mmt (to 22.5 mmt from 19.5 mmt in June) for 2026-27. Look for that to be increased in future updates as well.
Then there's the problem of suppliers. Ukraine has been one of the primary sources of European corn imports over recent years, but with the recent escalation in the war with Russia, Black Sea ports are virtually shut down. Until that is resolved, Ukraine's exports are choked off, with their farm minister just confirming that they have no real substitute to work with. In July (prior to the attacks on Black Sea shipping), USDA estimated Ukraine would supply 23 mmt, or 11%, of global corn exports. With that at risk, European importers will surely be looking at North American suppliers to help meet their growing demand.
As of July 23, total U.S. corn export commitments (outstanding sales plus shipments to date) to the EU stood at 7.628 mmt for the 2025-26 marketing year. That amounts to 41% of Europe's import requirements for the year (of 18.5 mmt). So, it should be safe to assume that a jump in import requirements for Europe with Ukraine supplies offline would result in just as significant of an increase in demand for additional U.S. corn.
Canada has a smaller but still significant relationship with Europe as well. Exports to European Union countries amounted to 2.556 mmt of the 2.776 mmt of corn exported from Canada in 2024-25. So far in 2025-26, exports are down sharply due to the small (drought-impacted) Eastern Canadian corn crop, but Europe remains the largest customer, taking 682,000 metric tons (mt) of a total of 955,000 mt exported as of the end of June, leaving it reasonable to assume Europe may want all that we can spare in 2026-27 given their situation.
That takes us to the technical analysis portion based on the accompanying chart. In short, all indications are that the bottom has been left far behind with significant upside potential remaining ahead.
A saucer bottom formed from February 2025 until the eventual breakout at the start of July (not drawn in on the accompanying chart but easily identifiable). That developed within a sideways channel between 185 and 232 euro/mt that has framed prices for most of the past few years. A breakup from the channel has a measured move equal in size to the old channel range, leaving an objective of 279 euro/mt. For the saucer, the longer it takes to form, the higher the target -- with this one coming in at around 360 euro/mt for a measured move. In addition, a bull pennant is being formed by the consolidation currently seen following the test of resistance at 263 euros in mid-July. The measured move for the pennant would be roughly 308 euro/mt. And finally worth noting, a breakaway gap was left on June 22 at 214.50 euro/mt, marking the beginning of the significant rally seen since.
There is obviously no certainty that any of the targets will be met, but the clear indication is that the technical analysis portion supports the bullish fundamental clues.
Finally, it's worth noting that the rally in European corn has not been insignificant, even if it has been largely ignored so far in Chicago. From the June low to the July high, European corn rallied almost 60 euro/mt. That is equivalent to $1.75 USD/bushel or $2.45 CAD/bushel, suggesting a very good reason for importers to look to North America to fill the void left by the drought.
I welcome feedback along with any suggestions for future blogs. My daily comments can be found in Plains, Prairies Opening Comments and Plains, Prairies Quick Takes on DTN products.
Mitch Miller can be reached at [email]mitchmiller.dtn@gmail.com[/email]
Follow him on social platform X @mgreymiller
(c) Copyright 2026 DTN, LLC. All rights reserved.
For the following chart...
European corn production estimates are declining with every update due to the prolonged drought while import estimates are increasing in step, suggesting multiple bullish formations on this weekly corn continuation chart need to be on the radar. (DTN ProphetX chart)
The European Corn Situation Demands Our Attention
8/5/2026 | 7:56 AM CDT
By Mitch Miller, DTN Contributing Canadian Grains Analyst
Feed grain markets in North America will almost certainly be impacted by this summer's record-setting drought in Europe, with the developing situation deserving our attention. And so, we shall give it.
The media has given scorching heat, lack of rainfall and resulting wildfires and damage to crops enough attention that I won't repeat details here. My focus is on the fundamental and technical factors that we should be aware of going forward.
Starting with the fundamentals, the European Commission provided a cereals market situation update on July 30 with significant alterations to its corn projections included. Setting the tone, corn seeded area was cut from 8.2 million hectares (mha) in the June forecast to 7.5 mha due to dry conditions. That left seeded area 11.1% below last year's 8.5 mha and 13.1% below the five-year average, solidifying a drop in production along the way.
Yield was lowered by 6% from last month, taking it to just 3% below last year and 2% below the five-year average. That is significant because it suggests further declines in yield and total production are likely, considering the crop condition declines still being seen.
As of July 27, the French corn crop was rated 34% good to excellent, compared with 84% as recently as mid-June. That is the lowest since records began in 2011, suggesting further declines in yield estimates are likely. A small crop tends to get smaller, being the common theory at play here.
Back to total production -- the European Commission estimated corn production will fall to 51.9 million metric tons (mmt) from 60.2 mmt last year, taking out the 2022 low mark and resulting in the smallest corn crop for the EU since 2007. With that crop being 49.5 mmt, it is certainly feasible that we could see the 2026 version fall below that yet. It is also worth noting that USDA (in its July 10 WASDE update) lowered its European corn production estimate from 57.5 mmt for 2025-26 to 53.78 mmt for 2026-27. Given what has transpired weather-wise since, look for that to fall further in future updates.
In response to the decline in production, the European Commission increased its estimate for corn imports to 24 mmt from 19 mmt last month. That would already take out the 2018 record of 23.6 mmt that we discussed in late June. For comparison, USDA was uncharacteristically aggressive in its July update, increasing the European corn import estimate by 3 mmt (to 22.5 mmt from 19.5 mmt in June) for 2026-27. Look for that to be increased in future updates as well.
Then there's the problem of suppliers. Ukraine has been one of the primary sources of European corn imports over recent years, but with the recent escalation in the war with Russia, Black Sea ports are virtually shut down. Until that is resolved, Ukraine's exports are choked off, with their farm minister just confirming that they have no real substitute to work with. In July (prior to the attacks on Black Sea shipping), USDA estimated Ukraine would supply 23 mmt, or 11%, of global corn exports. With that at risk, European importers will surely be looking at North American suppliers to help meet their growing demand.
As of July 23, total U.S. corn export commitments (outstanding sales plus shipments to date) to the EU stood at 7.628 mmt for the 2025-26 marketing year. That amounts to 41% of Europe's import requirements for the year (of 18.5 mmt). So, it should be safe to assume that a jump in import requirements for Europe with Ukraine supplies offline would result in just as significant of an increase in demand for additional U.S. corn.
Canada has a smaller but still significant relationship with Europe as well. Exports to European Union countries amounted to 2.556 mmt of the 2.776 mmt of corn exported from Canada in 2024-25. So far in 2025-26, exports are down sharply due to the small (drought-impacted) Eastern Canadian corn crop, but Europe remains the largest customer, taking 682,000 metric tons (mt) of a total of 955,000 mt exported as of the end of June, leaving it reasonable to assume Europe may want all that we can spare in 2026-27 given their situation.
That takes us to the technical analysis portion based on the accompanying chart. In short, all indications are that the bottom has been left far behind with significant upside potential remaining ahead.
A saucer bottom formed from February 2025 until the eventual breakout at the start of July (not drawn in on the accompanying chart but easily identifiable). That developed within a sideways channel between 185 and 232 euro/mt that has framed prices for most of the past few years. A breakup from the channel has a measured move equal in size to the old channel range, leaving an objective of 279 euro/mt. For the saucer, the longer it takes to form, the higher the target -- with this one coming in at around 360 euro/mt for a measured move. In addition, a bull pennant is being formed by the consolidation currently seen following the test of resistance at 263 euros in mid-July. The measured move for the pennant would be roughly 308 euro/mt. And finally worth noting, a breakaway gap was left on June 22 at 214.50 euro/mt, marking the beginning of the significant rally seen since.
There is obviously no certainty that any of the targets will be met, but the clear indication is that the technical analysis portion supports the bullish fundamental clues.
Finally, it's worth noting that the rally in European corn has not been insignificant, even if it has been largely ignored so far in Chicago. From the June low to the July high, European corn rallied almost 60 euro/mt. That is equivalent to $1.75 USD/bushel or $2.45 CAD/bushel, suggesting a very good reason for importers to look to North America to fill the void left by the drought.
I welcome feedback along with any suggestions for future blogs. My daily comments can be found in Plains, Prairies Opening Comments and Plains, Prairies Quick Takes on DTN products.
Mitch Miller can be reached at [email]mitchmiller.dtn@gmail.com[/email]
Follow him on social platform X @mgreymiller
(c) Copyright 2026 DTN, LLC. All rights reserved.
For the following chart...
European corn production estimates are declining with every update due to the prolonged drought while import estimates are increasing in step, suggesting multiple bullish formations on this weekly corn continuation chart need to be on the radar. (DTN ProphetX chart)
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