September 14, 2026

USDA Cuts Corn Outlook, Raises Soybean Production Estimate

USDA lowered its corn production forecast while slightly increasing its soybean estimate in its September Crop Production and World Agricultural Supply and Demand Estimates reports released Friday. USDA projected the national corn yield at 178.5 bushels per acre, down 2.2 bushels from its August forecast. Production is now estimated at 15.8 billion bushels, down 213 million bushels from last month. Projected 2026-27 corn ending stocks fell to 1.567 billion bushels, while the average farm price increased 30 cents to $4.80 per bushel. Soybean production was raised to a record 4.535 billion bushels, with the national yield increasing slightly to 52.8 bushels per acre. Soybean ending stocks were reduced to 310 million bushels, while the projected farm price climbed 60 cents to $12 per bushel. USDA left U.S. wheat production unchanged at 1.531 billion bushels.

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First U.S. Horse Infected with New World Screwworm

USDA has confirmed the first New World screwworm infection in a U.S. horse, marking another troubling development in the parasite’s return to the United States. The case involves a working ranch horse in Presidio County, Texas, near the Mexican border. The infestation was found in a wound on the horse’s hind limb. Texas officials have restricted movement of susceptible warm-blooded animals within an infested zone covering portions of Presidio and Jeff Davis counties. New World screwworm larvae feed on the living tissue of animals and can cause serious injury or death. The parasite was eradicated from the United States decades ago but returned this summer, when USDA confirmed cases in Texas cattle. A widespread outbreak could have enormous consequences for cattle producers through animal losses, treatment costs and livestock-movement restrictions. USDA continues surveillance, trapping and sterile-fly releases as part of its eradication effort.

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U.S. Diesel Price Tops $6 a Gallon for First Time

The national average diesel price has exceeded $6 per gallon for the first time, creating an immediate cost problem for farmers entering the heart of harvest. GasBuddy reported Thursday that diesel reached the record as global petroleum supplies tightened because of Middle East disruptions, Ukrainian attacks on Russian refineries and fuel-export restrictions from Russia and China. U.S. diesel inventories are about 13% below their five-year average, according to Reuters. Refining margins for diesel have also reached record levels. The timing could hardly be worse for agriculture. Combines, tractors, grain trucks and irrigation systems consume enormous quantities of diesel during harvest, meaning the increase could significantly raise production and transportation costs. Higher petroleum prices could benefit ethanol and renewable diesel by improving their economics relative to fossil fuels, but the immediate impact for most farmers is sharply higher operating expenses.

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China Continues Buying U.S. Soybeans Ahead of Xi Visit

China’s recent buying spree continued Thursday when USDA announced another 272,000 metric tons of U.S. soybean sales to China for the 2026-27 marketing year.  USDA also reported 206,500 tons sold to unidentified destinations. Those sales follow China’s purchase of approximately 1 million metric tons of American soybeans this week, according to traders interviewed by Reuters. The buying comes ahead of Chinese President Xi Jinping’s expected visit to Washington later this month and as Brazilian soybean supplies tighten. China has now purchased nearly half of the 25 million metric tons annually it committed to buy through 2028 under its agreement with Washington. The remaining 10% Chinese tariff on U.S. goods still discourages private crushers from buying American beans. Any reduction in that tariff during upcoming negotiations could produce another significant wave of soybean demand during harvest.

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Ethanol Demand Remains Above Last Year Despite Weekly Slowdown

U.S. ethanol production and blending declined slightly during the latest reporting week, but underlying demand remains stronger than a year ago. The U.S. Energy Information Administration reported Thursday that ethanol production averaged 1.099 million barrels per day during the week ended Sept. 4. Ethanol blending averaged 908,000 barrels per day, down from the previous week but 3.2% above the comparable period last year. The four-week average blending rate was also above year-ago levels. Inventories increased to 25.187 million barrels, approximately 10.3% above a year earlier. The report presents a mixed picture for corn growers: inventories are relatively large, but gasoline blending continues to provide substantial domestic corn demand. The extraordinary increase in petroleum prices adds another variable. With crude oil above $100 and diesel at record highs, biofuels are becoming increasingly attractive from an energy-security and fuel-cost standpoint.

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Oil Supply Outlook Worsens, Threatening Fertilizer and Transportation Costs

The International Energy Agency warned Friday that global oil supplies could decline by approximately 5.7 million barrels per day in 2026, considerably more than previously forecast because of disruptions involving Middle Eastern producers. Saudi Arabian production reportedly fell to around 6 million barrels per day in August, its lowest level in more than 30 years. Brent crude remained above $100 Friday and was headed toward an 8% weekly increase, despite easing somewhat during morning trading. The implications extend well beyond farm diesel. Petroleum and natural-gas markets influence fertilizer manufacturing, agricultural chemicals, grain transportation and food-processing costs. Higher energy prices also are increasing inflation concerns and pushing interest rates higher, potentially increasing borrowing costs for farmers already carrying more expensive operating debt. For agriculture, the situation presents an unusual combination: higher production costs but potentially stronger ethanol and renewable-fuel economics.

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