May WASDE signals optimism for soybean, corn, cotton, rice growers
May 20, 2026
Fast Facts
- WASDE forecasts higher prices for four key commodities
- Forecast El Niño may affect rice-growing regions of SE Asia
- Stiles: ‘There are pockets of optimism for the 2026 crop year.’
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JONESBORO, Ark. — May’s World Agricultural Supply and Demand Estimates, or WASDE, report is shining a biofueled ray of light as it forecasts higher average prices for soybeans and corn.
Each month, the U.S. Department of Agriculture’s World Agricultural Outlook Board issues the WASDE report to provide annual forecasts for supply and use of U.S. and world wheat, rice, coarse grains, oilseeds and cotton. The report also covers U.S. supply and use of sugar, meat, poultry, eggs and milk.
Plant-based fuels such as biodiesel and ethanol are helping drive soybean and corn prices. WASDE also forecasts higher prices for rice and cotton, driven by a potential El Niño and higher input prices, respectively.
What it means for farmers
Farmers have struggled for the last few years, stuck between lower commodity prices and higher costs of doing business. While higher commodity prices are welcome, will they improve conditions for farmers?
“As frequently stated in economics: ‘It depends,’” said Scott Stiles, extension economics program associate for the University of Arkansas Division of Agriculture.
Hunter Biram, extension agricultural economist for the Division of Agriculture, said it behooves farmers to consider using risk management tools, including forward contracts, to lock in some price upside prior to harvest.
“New crop prices tend to increase leading up to the end of June into July, driven by a weather risk premium,” Biram said. “In other words, there is a premium associated with the uncertainty surrounding the amount of new crop production up until around the USDA June Acreage Report.
“After the release of the report, new crop prices tend to decline in the months leading up to harvest,” he said. “Guaranteeing higher prices at harvest with a forward contract is probably the best way to manage price risk.”
While this is generally true for all farmers, “it is especially true for farmers with no storage options who have to market their crop at harvest when prices tend to be lowest,” Biram said.
“The now-recurring issue of low levels along the Mississippi River exacerbates the drop in prices driven by harvest glut since grain buyers offset increased barge freight costs with lower cash prices offered to farmers.”
Pockets of optimism
“The current price levels for corn, soybeans and cotton likely offer some profitable opportunities for operations that own the bulk of their farmland,” Stiles said. “Operations that were able to lock in fertilizer and fuel prior to the Iran conflict are also sitting in a better position financially.
“Input costs remain burdensome. However, there are pockets of optimism for the 2026 crop year,” Stiles said. “The recent trade announcement with China is providing a lift to all crop prices at the moment. We just need to see some follow-through sales.”
Here’s a breakdown by commodity:
Soybeans
According to WASDE, total consumption of the 2026 soybean crop going into 2027 is expected to increase 218 million bushels to 4.49 billion, based on a record crush of 2.75 billion bushels and a modest improvement in exports up to 1.63 billion bushels.
The marketing year average farm price for the 2026-27 crop is projected at $11.40 compared to $10.40 in 2025-26.
“Marketing year” refers to the 12-month period that begins with the crop harvest. “Year-end stocks” are simply the supply of a particular commodity held by producers or users at the end of a year.
The record soybean crush is “an increase in demand for soybean oil to produce renewable diesel, due to recent policy changes,” Stiles said.
“The EPA increased blending rates for biomass-based diesel, and to meet the new mandates, USDA is projecting soybean crush will need to hit a record 2.75 billion bushels for the 2026-27 marketing year,” Stiles said. “That equates to an additional 120 million bushels compared to the 2025-26 marketing year projections.”
China will be the top soybean export market for the U.S., he said.
“If all goes according to plan, the Chinese are expected to purchase 25 million metric tons of the 2026 crop,” Stiles said. “That's close to 920 million bushels and about twice the number of bushels China will buy in the 2025-26 marketing year.”
Corn
The 2026-27 corn crop is projected at 16 billion bushels, down 6 percent from last year’s record crop on declines in both acreage and yield.
Total corn supplies are projected to decline 2 percent to 18.1 billion bushels, and total U.S. corn use for 2026-27 is forecast to fall 2 percent relative to a year ago on reductions in domestic use and exports.
Food, seed and industrial use is forecast flat at 6.955 billion bushels. Feed and residual use is projected down 100 million bushels to 6.1 billion bushels on lower production and higher prices. U.S. corn exports for 2026-27 are forecast to decline 150 million bushels from a year ago to 3.15 billion bushels.
Driven by lower production, 2026-27 ending stocks are expected to decline 185 million bushels to 1.957 billion. The 2026-27 season-average farm price is projected at $4.40 per bushel, up 25 cents from $4.15 in the current marketing year.
“A key portion of U.S. corn demand is ethanol, and that is mandated at 15 billion gallons annually,” Stiles said. “It will be stable year-to-year. Other sources of demand such as feed and exports are more price sensitive.
“On lower U.S. corn production in 2026, USDA is looking for some price increase in corn,” he said. “This may encourage some switching to alternative grains for feed use. It may also encourage some of our traditional export markets to shop around.”
Stiles said corn from Brazil and Argentina may be more competitively priced against a more expensive U.S. corn.
“Other factors come into play here too: the strength of the U.S. dollar, the status of U.S. trade relationships with various countries. There are lots of variables,” he said.
Cotton
The May U.S. cotton 2026-27 projections include a smaller crop, an increase in exports, unchanged mill use and lower ending stocks compared with the 2025-26 season. New crop production is expected to be 13.3 million bales, 600,000 bales less than in 2025-26.
Domestic mill use is expected to be flat year-to-year at 1.6 million bales. Exports are expected to increase to 12.3 million bales from 12 million in 2025-26. Ending stocks are expected to decrease to 3.9 million bales from 4.4 million in 2025-26. That represents the smallest number of bales since the 3.15 million in 2023-24 and is below the 10-year average of 4.25 million bales.
The forecast average price of 73 cents for the 2026-27 marketing year is up compared to 63 cents for the 2025-26 crop.
Stiles said, “U.S. 2026 cotton exports are projected to increase 300,000 bales or a little over 2 percent.
“I think that is largely driven by lower cotton production in Brazil”, he said. “USDA sees their production down 2 million bales and Australia down 1.5 million bales in 2026-27. Those are our key export competitors.”
Brazil’s lower cotton production is likely due to higher interest rates and input prices, according to USDA’s Foreign Agricultural Service.
“In past years, China was our largest export market for cotton,” he said. “Today, our largest buyer is Vietnam. U.S. raw cotton can enter Vietnam on more favorable terms in regard to tariffs and quotas. There, it's spun and converted to yarn and commonly sent into China for finished good production.
“And, if crude oil stays around $100 for a considerable length of time, cotton becomes a more price-competitive textile,” he said. For every $10 increase in crude oil prices, synthetic fiber production costs typically rise by 4 percent to 6 percent.”
Rice
U.S. long-grain rice production is projected at 122.5 million hundredweight, down 20 percent from last year on reduced acreage, making it the smallest long-grain crop since 2011.
Total supply is forecast at 201.1 million hundredweight, down nearly 12 percent from last year on lower production. Total use is projected at 173.0 million hundredweight, down from 188 million in the current year.
Total exports are projected at 50 million hundredweight, down 1.0 million hundredweight from 2025-26, on continued strong global competition and higher U.S. long-grain prices. Domestic use is forecast at 123 million hundredweight, down 14 million from 2025-26.
Ending stocks are projected at 28.1 million hundredweight, down 29 percent from last year and the lowest since 2023-24. The 2026-27 season average farm price for long-grain is projected at $12.00 per hundredweight, up from $10.40 in 2025-26.
“I think the futures market senses that actual 2026 rice acres are lower than the March Prospective Plantings estimate,” Stiles said. “Sharp increases in nitrogen and fuel prices likely had some impact on rice acreage — especially for those that did not buy those inputs pre-Iran war.”
As the rice price surge didn’t begin until early May, we won't know the full extent of acreage re-shuffling until we see USDA’s June Acreage report,” he said. “Some shifting from rice to soybeans is certainly possible. In addition, there is a lot of discussion about the transition to El Niño later this summer. That could significantly reduce rice production in India and across Southeast Asia.”
El Niño events tend to mean hotter, drier conditions for Southeast Asia.
Find further analysis at Southern Ag Today, or listen to Biram and Stiles discuss the May WASDE on the Morning Coffee and Ag Markets podcast.
To learn about extension programs in Arkansas, contact your local Cooperative Extension Service agent or visit uaex.uada.edu. Follow us on Facebook and Instagram. To learn more about the Division of Agriculture, visit uada.edu. To learn more about ag and food research in Arkansas, visit the Arkansas Agricultural Experiment Station at aaes.uada.edu.
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The University of Arkansas Division of Agriculture’s mission is to strengthen agriculture, communities, and families by connecting trusted research to the adoption of best practices. Through the Agricultural Experiment Station and the Cooperative Extension Service, the Division of Agriculture conducts research and extension work within the nation’s historic land-grant education system.
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Media Contact:
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Nkordsme@uada.edu