Canada Markets
Following Corn Breakout, What Comes Next?
8/27/2026 | 11:54 AM CDT
By Mitch Miller, DTN Contributing Canadian Grains Analyst
Fundamental factors behind the recent surge in corn prices should be well known by now. The bullish August WASDE update followed by an even more bullish corn yield estimate from Pro Farmer based on their annual crop tour findings, damage done to the European corn crop by their extreme drought with record corn imports now expected, and growing anxiety over what the developing super El Nino might do to South American production potential in the months ahead.
Then throw in Russia and Ukraine weaponizing grain by attempting to block the other's shipments out of the Black Sea region. In fact, Wednesday's extension in corn price (that was accompanied by limit gains in Chicago wheat) was inspired by reports that Russian President Vladimir Putin plans to escalate the war with Ukraine, seeing any further talks as "Fruitless." Which of course does not bode well for any sort of recovery in Black Sea shipping by either country anytime soon.
All of those influences resulted in a breakout from the price range that we have been stuck in for 3 years -- but now what? That is when trying to determine the type of market we are dealing with is important along with looking at technical analysis for clues regarding timing.
Looking first at the market dynamics, I am reminded of one of the phrases that I dislike the most. "A bull needs to be fed constantly, or it dies". Unfortunately, that is true for most run-of-the-mill bull markets, with adequate supplies but prices that had become undervalued. But a commercial led bull market is another beast altogether.
When supplies appear to be at risk of declining to a level that threatens availability, end users feel the need to cover their requirements regardless of price, and you have a commercial bull market on your hands. Price pullbacks tend to be shallow as end users aren't patient enough to risk missing out, and price spikes are usually more aggressive.
A good example was the corn market in 1995-96 when China began aggressively importing corn to everyone's surprise. Corn prices went from $2.33/bushel at the end of 1994 to $5.18/bushel by June 1996 with only one month had a lower low than the previous month. The rally also set a new record high price along the way. As an interesting side note, China has gone years now living off domestic inventory, drawing those supplies down while avoiding imports. Should they decide that they need to return as a major importing country, the analogy from 30 years ago may take on even more significance.
Back on point, it should be safe to assume that end users throughout the world have good reason to be concerned about limited supplies of available corn. And thus, as in any good commercial bull market, profit taking pullbacks may be shallow and short-lived while spikes in between could be significant.
Looking at the technicals for clues, the obvious one on the accompanying chart is the breakout from the sideways channel that prices have been trading in for three years now. The normal measured move for a breakout of a channel is the same range added to the breakout level. Other than a few failed attempts to break out either way, prices were confined to a channel between $4/bushel and roughly $5.07/bushel.
So, you add the $1.07 range to the breakout level and your target would be approximately $6.14/bushel. The $6 to $6.30/bushel area contained some important previous support and resistance levels that traders may want to test now.
The other, more important clue is hard to see on the chart, but very significant. A gap up was left on Sunday evening's open thanks to the bullish Pro Farmer corn yield estimate that was released after the close on Friday. It is found between $5.09 and $5.1025/bushel on both the daily and weekly charts and would clearly be considered a breakaway gap given the price gains seen following. That is a critical clue as it suggests much higher prices to come.
The normal course of action under such circumstances would be for profit taking to set in now that prices have rallied almost $1.40/bushel in less than two months. That would often result in a pullback to test support at old resistance at the breakout level while traders try to fill the breakaway gap.
Time will tell but be aware that such a development would be healthy for the long run price potential, and not necessarily a reason to panic. Should the gap be filled and support fail, then adjustments would need to be made to the marketing strategy.
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...
This weekly corn continuation chart not only shows the impact that July heat had on U.S. corn production by the price breakout, but it can also supply clues as to what may come next. (DTN ProphetX chart)
Following Corn Breakout, What Comes Next?
8/27/2026 | 11:54 AM CDT
By Mitch Miller, DTN Contributing Canadian Grains Analyst
Fundamental factors behind the recent surge in corn prices should be well known by now. The bullish August WASDE update followed by an even more bullish corn yield estimate from Pro Farmer based on their annual crop tour findings, damage done to the European corn crop by their extreme drought with record corn imports now expected, and growing anxiety over what the developing super El Nino might do to South American production potential in the months ahead.
Then throw in Russia and Ukraine weaponizing grain by attempting to block the other's shipments out of the Black Sea region. In fact, Wednesday's extension in corn price (that was accompanied by limit gains in Chicago wheat) was inspired by reports that Russian President Vladimir Putin plans to escalate the war with Ukraine, seeing any further talks as "Fruitless." Which of course does not bode well for any sort of recovery in Black Sea shipping by either country anytime soon.
All of those influences resulted in a breakout from the price range that we have been stuck in for 3 years -- but now what? That is when trying to determine the type of market we are dealing with is important along with looking at technical analysis for clues regarding timing.
Looking first at the market dynamics, I am reminded of one of the phrases that I dislike the most. "A bull needs to be fed constantly, or it dies". Unfortunately, that is true for most run-of-the-mill bull markets, with adequate supplies but prices that had become undervalued. But a commercial led bull market is another beast altogether.
When supplies appear to be at risk of declining to a level that threatens availability, end users feel the need to cover their requirements regardless of price, and you have a commercial bull market on your hands. Price pullbacks tend to be shallow as end users aren't patient enough to risk missing out, and price spikes are usually more aggressive.
A good example was the corn market in 1995-96 when China began aggressively importing corn to everyone's surprise. Corn prices went from $2.33/bushel at the end of 1994 to $5.18/bushel by June 1996 with only one month had a lower low than the previous month. The rally also set a new record high price along the way. As an interesting side note, China has gone years now living off domestic inventory, drawing those supplies down while avoiding imports. Should they decide that they need to return as a major importing country, the analogy from 30 years ago may take on even more significance.
Back on point, it should be safe to assume that end users throughout the world have good reason to be concerned about limited supplies of available corn. And thus, as in any good commercial bull market, profit taking pullbacks may be shallow and short-lived while spikes in between could be significant.
Looking at the technicals for clues, the obvious one on the accompanying chart is the breakout from the sideways channel that prices have been trading in for three years now. The normal measured move for a breakout of a channel is the same range added to the breakout level. Other than a few failed attempts to break out either way, prices were confined to a channel between $4/bushel and roughly $5.07/bushel.
So, you add the $1.07 range to the breakout level and your target would be approximately $6.14/bushel. The $6 to $6.30/bushel area contained some important previous support and resistance levels that traders may want to test now.
The other, more important clue is hard to see on the chart, but very significant. A gap up was left on Sunday evening's open thanks to the bullish Pro Farmer corn yield estimate that was released after the close on Friday. It is found between $5.09 and $5.1025/bushel on both the daily and weekly charts and would clearly be considered a breakaway gap given the price gains seen following. That is a critical clue as it suggests much higher prices to come.
The normal course of action under such circumstances would be for profit taking to set in now that prices have rallied almost $1.40/bushel in less than two months. That would often result in a pullback to test support at old resistance at the breakout level while traders try to fill the breakaway gap.
Time will tell but be aware that such a development would be healthy for the long run price potential, and not necessarily a reason to panic. Should the gap be filled and support fail, then adjustments would need to be made to the marketing strategy.
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...
This weekly corn continuation chart not only shows the impact that July heat had on U.S. corn production by the price breakout, but it can also supply clues as to what may come next. (DTN ProphetX chart)