The United States is preparing for a record grain harvest this fall, reaching a total of 21.5 billion bushels of corn, soybeans, and sorghum. However, according to a recent market report from CoBank, this abundant season brings major challenges for farmers due to weak export demand, low prices, and uncertainty in trade relations with China. Storage capacity and transportation logistics have also become far more complicated than usual.
CoBank’s analysis reveals that U.S. grain storage space will be extremely tight this fall. With limited capacity, storage operators are charging higher fees, while grain merchants are trying to find profit opportunities in a risky market environment.
According to CoBank economist Tanner Ehmke, “The top 12 corn-producing states face a 1.4-billion-bushel shortage of upright grain storage this year, forcing elevators to rely on bunkers and emergency ground piles.”
U.S. corn and wheat exports are showing strong momentum, supported by low prices, a weak dollar, and favorable transportation costs. Corn sales are up 94% year-over-year, and wheat sales have increased by 41%. However, soybean and sorghum exports are moving in the opposite direction — soybean sales are down 51% and sorghum sales have dropped 58%.
This weak soybean shipping pace has allowed more transportation and elevation capacity to be allocated for corn and wheat exports.
Rail freight rate reductions have boosted corn and wheat shipments, especially to Mexico and the Gulf region. But the lack of export demand for soybeans in the Pacific Northwest has led rail companies to limit service to that area.
Meanwhile, low water levels on the Mississippi River have caused draft restrictions, driving barge rates higher. As of September 23, grain shipping costs along the lower Mississippi reached $19.53 per ton — up 31% from the previous month.
Amid expectations of a record harvest, corn basis levels across the country have weakened, while strong demand has prompted elevators to prioritize corn storage. The slowdown in soybean exports, particularly in the Northern Plains, has led to lower basis levels, although expanding domestic soy crush capacity has provided some local support.
In regions dependent on exports, some elevators are refusing to accept soybeans due to the risk of not finding buyers later. “Because of export uncertainty, some operators are setting historically low basis levels and charging higher storage fees for soybeans,” Ehmke explained.
