• The December corn futures contract looks to have made an early move to a seasonal downtrend.
• Meanwhile, the Teucrium CORN ETF remains inn a long-term uptrend.
• Fundamentally, the corn market remains long-term neutral. 

As you likely recall, I view the corn market, in all its different forms, as a solid long-term investment opportunity. To me it is like the Treasury market in the Financials sector, providing stability in the otherwise increasingly volatile Grains sector. In my portfolio it also fits a number of well-established investment criteria starting with Peter Lynch’s idea of “investing in what you know”. To this we can add Malcolm Gladwell’s “10,000-hour rule” that suggests “10,000 hours of deliberate practice are needed to achieve mastery in a particular field”^[i]. I moved to the US Corn Belt 21.33 years ago:

• Roughly 256 months
• Or 1,110 weeks
• Or 6,655 days
• Or roughly 53,240 hours

During that time, I’ve studied the corn market more than any other, and that isn’t counting time spent the 15 years or so leading up to our move to Omaha. Yes, I’m comfortable using corn as long-term investment. Given that, let’s take a look at corn using 3 of my Market Rules. 

Rule #1: Don’t get crossways with the trend. Based on the continuous monthly charts for December corn futures and the Teucrium CORN ETF (CORN), both markets look to be in long-term sideways trends. The futures market posted the low end of its range last August as Dec24 hit a low of $3.85 before Dec25 (ZCZ25) established the high end this past February at $4.7975. Generally speaking, and applying corn’s characteristic Round Number Reliance, the expected long-term range is roughly $3.80 to $4.80. As of this writing, Dec25 is priced near $4.50. We see a similar pattern on CORN’s long-term monthly chart. The fund posted a low of $17.02 during August 2024 before rallying to a high of 20.69 this during February. Again, take note of the round numbers as support and resistance. Part of knowing a market is understanding its particular quirks. 

Rule #3: Use filters to manage risk. I’ll get to Rule #2 in a moment, but as we get set to turn the calendar page from April to May we need to keep in mind the seasonal pattern for the various corn markets. December futures tend to post a high weekly close the second week of May before falling 13% through the fourth week of August. As of this writing (April 28), Dec25 has a high weekly close of $4.75 from the third week of February and a secondary high weekly close of $4.66 from the third week of April. Given this, the downside target area for a low weekly close in late August would be: 

• $4.13 using the price from late February based on this being the seasonal high weekly close
• $4.05 using the price from late April based on it being nearer to the normal seasonal high weekly close

This brings price distribution into play. 

• If Dec25 falls to a low weekly close of $4.13 by late August it would put the contract in the lower 22% of its range dating back through 2020.
• If Dec25 falls to a low weekly close of $4.05 it would but it in the lower 20% of its distribution range.
• Not only does this create a potential buying opportunity, but it puts Dec25 in the lower part of its sideways range as well. 

Could Dec25 fall further than the low $4.00s? Certainly. Recall both seasonal and price distribution analysis look at market filters. The bottom line is still fundamentals.

Rule #6: Fundamentals win in the end. Warren Buffett has long advocated using fundamentals as a measure of an investments opportunity for growth. Who am I to argue with the Oracle of Omaha? If we apply our read on real long-term corn market fundamentals – its futures spreads – we see the market is still neutral. At last Friday’s close the 2025-2026 futures spreads showed:

• The Dec25-Mar26 spread covered 45%
  • as compared to the previous week’s close of 39%
• The Mar26-May26 spread covered 42%
  • as compared to the previous week’s close of 32%
• The May26-Jul26 spread covered 23%
  • as compared to the previous week’s close of 15%
• The Dec25-Jul26 forward curve covered 38%
  • as compared to the previous week’s close of 30%

The bottom line is the commercial side is putting increased pressure on the new-crop corn market, meaning there is time (seasonal) and space (price distribution) for Dec25 to move lower. 
 

^[i] From Gladwell’s book “Outliers”