Another week of sweltering weather across the US Midwest brought more heat advisories and put fresh pressure on yields. Corn has broken above $5 a bushel, up roughly 15% from the end of July and back to territory not seen since 2023. Europe's grain fields have also struggled under heat waves, and fighting between Russia and Ukraine continues to snarl Black Sea exports.
China has recently stepped up purchases of US soybeans. Separately, the Bloomberg Agriculture Spot Index - covering 10 major commodities - has climbed over 20% since the end of June, offering US growers a timely boost as harvest kicks off.
The rally is showing up in the countryside through stronger bids at grain terminals and more opportunities to lock in margins using futures. Iowa grower Dave Walton called the move a turning point for his operation. "We've been fairly aggressive selling into this rally, and so we're looking at black ink all the way across the board," he said, adding, "If I would have sold even six weeks ago, we'd still have been in the red on some of it." Walton, who raises soybeans, corn, and wheat, is also a vice president with the American Soybean Association.
At the Farm Progress Show in Iowa, Walton checked out CNH Industrial NV's New Holland tractors and sprayers while sizing up his own prospects. After some timely rains across eastern Iowa, he now anticipates a "pretty good bean crop," while corn prospects look average to slightly below average. Even so, he said he needs at least one more year of solid profits before committing to big-ticket machines. As he put it at the show site outside Des Moines, "There's very little we can afford, so you're window shopping."
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Manufacturers are eager to see browsing turn into orders. Used-tractor prices have leveled off, and Deere & Co. and CNH have both lately signaled improving conditions. Still, patience may be required.
Scott Harris, president of CNH in North America, said the worst is likely past but the rebound will be more L-shaped globally, with Europe and Brazil lagging the US. "I am more optimistic about the upturn in the second half of 2027 after we see what gets in the bin this year, and get some stability in the markets," he said at the show.
AGCO Corp. cut its profit guidance when it issued second-quarter results on July 30, and says it is already seeing momentum shift. At the Farm Progress event, the company introduced a new Fendt tractor and observed some early traction. "We closed a dozen deals at the dinner last night, which is very unusual," Chief Executive Officer Eric Hansotia said, noting, "We sold nothing at the show last year, so that was a very positive comparison."
USDA figures project farmers' cash receipts from crops will rise 6.1% year over year in 2026, and market data released Friday show the net-bullish position in corn futures at a record. Farmers welcome the timing as combines start to roll. But years of thin margins and higher costs have left many cautious about writing big checks for equipment, which could keep machinery demand from snapping back quickly. If you follow ag or commodities, watch how harvest results, weather, and export flows shape whether this rally sticks - and how long farmers keep window-shopping before they buy.
