Corn Futures Trading Basics

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Keys to Trading Corn Futures

Nathan Benn/Corbis Documentary / Getty Images

Trading corn futures is similar to corn farming, in that they both must pay close attention to seasons and the weather. Trading corn futures can be fairly subdued during the winter months, while the summer months are not for the faint of heart. Corn is planted in the spring and harvested in the fall, and this growing season is when most of the action in corn prices takes place.

The movement during the winter months usually stems from demand and how much of the harvested crop is sold every week. During the summer months, corn traders carefully watch every updated weather report for any potential weather problems in corn-growing areas.

Planting Intentions Report

In spring, the USDA’s Planting Intentions report kicks off planting season for traders. This report is released at the end of March. The Planting Intentions report tends to set the tone for the market for the season. It reveals the amount of acreage that farmers intend on planting for each crop. The fewer acres planted, the lower the chance of a large crop. Analysts will take the number of acres and multiply it by a trend yield to get the expected size of the crop for the season to project the entire size of the crop.

Demand is the next part of the corn futures valuation equation. About 40% of the corn crop goes to ethanol production. Most of the remainder goes to feed livestock like cattle, hogs, chickens, and other animal protein. Perhaps surprisingly, only a small portion goes to actual human consumption. Therefore, it is more important to monitor the price of crude oil and gasoline, which determines the demand for ethanol. A cheap corn price while the price of crude oil is high, for example, can lead to an increased demand for ethanol.

The USDA Report

The USDA releases an export report every Thursday, which details the demand for corn exports. A strong export market will often help corn prices move higher. It is also advisable to monitor the price of corn from other exporting countries. If the price of U.S. corn is much higher than other competing countries, then the chances for a strong export market will diminish.

The summer months are when trading corn futures takes on another dimension. The high price for corn is often set in late June or August. This is mostly due to weather scares that happen during the height of the growing season, at a point when crops are most vulnerable. Extreme heat and droughts in the Midwest are the biggest fear for farmers and corn traders.

The Largest Corn-Producing States

Mid-to-late July is when corn goes through its critical pollination phase. Corn needs moisture and moderate temperatures at this stage to ensure a healthy and high-yielding crop. Extreme heat (roughly 100 degrees or more) and dry soil will damage crops, leading to lower yields. Crop damage causes the price of corn to rise.

The main states to watch for weather reports are Illinois, Indiana, Iowa, Nebraska, and Ohio. These are the largest corn-producing states. Pockets of extreme weather regularly affect smaller regions, but there are occasionally widespread instances of drought and heatwave—causing the price of corn to skyrocket.

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Luckily, many bad weather reports don’t play out under a worst-case scenario, and little material damage is done to the overall crop. The market will often move higher briefly, only to return to a lower price once the fear of crop damage subsides. More often than not, it is a good idea to look for selling opportunities during the summer months on these rallies.

How the Market Is Affected by Problems with Corn Crops

Every couple of years, the fears (or realities) of crop damage result in price increases that can be explosive. In 2020, a drought took the price of corn to an all-time high.

Corn has a seasonal tendency to hit peak prices during late June or early July. When there is a serious problem with a corn crop, the market tends to panic, and that can push the peak prices even higher. However, demand tends to fall substantially when prices rise to an extreme. It is the market’s job to find a price that will stifle demand and ration supplies.

By contrast, corn prices often hit their lows around harvest time—usually in November. Harvest season is when the largest supplies are available and many corn farmers are selling their cash crops. After that, during the winter months, corn prices tend to have less volatility. Exports and demand are the main factors for corn prices during those relatively calm months.

The Balance does not provide tax, investment, or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal.

Corn Futures Trading Basics

Corn futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of corn (eg. 50 tonnes) at a predetermined price on a future delivery date.

Corn Futures Exchanges

You can trade Corn futures at Chicago Board of Trade (CBOT), NYSE Euronext (Euronext) and Tokyo Grain Exchange (TGE).

CBOT Corn futures prices are quoted in dollars and cents per bushel and are traded in lot sizes of 5000 bushels (127 metric tons).

Euronext Corn futures are traded in units of 50 tonnes and contract prices are quoted in dollars and cents per metric ton.

TGE Corn futures prices are quoted in yen per metric ton and are traded in lot sizes of 50 tonnes .

Exchange & Product Name Symbol Contract Size Initial Margin
CBOT Corn Futures
(Price Quotes)
C 5000 bushels
(Full Contract Spec)
USD 2,025 (approx. 11%)
(Latest Margin Info)
Euronext Corn Futures
(Price Quotes)
EMA 50 tonnes
(Full Contract Spec)
EUR 700 (approx. 11%)
(Latest Margin Info)
TGE Corn Futures
(Price Quotes)
50 tonnes
(Full Contract Spec)
JPY 75,000 (approx. 10%)
(Latest Margin Info)

Corn Futures Trading Basics

Consumers and producers of corn can manage corn price risk by purchasing and selling corn futures. Corn producers can employ a short hedge to lock in a selling price for the corn they produce while businesses that require corn can utilize a long hedge to secure a purchase price for the commodity they need.

Corn futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable corn price movement. Speculators buy corn futures when they believe that corn prices will go up. Conversely, they will sell corn futures when they think that corn prices will fall.

Learn More About Corn Futures & Options Trading

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Welcome to Corn Futures

CBOT Corn futures (ticker symbol ZC) give you an easy, liquid tool to profit from or hedge against price movements in the United States’ most widely grown crop.

Individual traders, grain elevators, farmers, investors and commercial firms are among the diverse, global participant base that trade this fully electronic contract; the most liquid and active market in grain and oilseeds, trading on average more than 350,000 contracts per day.

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Sign up to receive our daily futures and options newsletter, In Focus.

Chicago Board of Trade (CBOT), home of the global grain and oilseeds marketplace, is one of four U.S. exchanges operated by CME Group, the world’s largest derivatives marketplace.

Corn Futures

H, K, N, U, Z (Mar, May, Jul, Sep, Dec)

U.S. Dollars and Cents per bushel

Sunday – Friday, 7:00 p.m. – 7:45 a.m. CT and Monday – Friday, 8:30 a.m. – 1:20 p.m. CT

Dollar Value of One Tick

Product Last Change Chart Globex Vol

Why Trade ZC Futures?

The world produced over 41 billion bushels in 2020/18, but 11 times that many bushels were traded on the futures exchange in 2020.

The USDA World Agricultural Supply and Demand Estimate (WASDE) report offers an opportunity for traders to take a market view around the report release and then take action in the futures market.

Corn futures offer a central, transparent point of global price discovery in a market that can shift frequently based on weather conditions, politics, crop conditions, shipping and freight issues, and more.

Benefits of Trading Corn Futures (ZC)

Leading liquidity
With 350,000+ traded per day on average and OI peaking at 1.7 million, enter/exit positions with ease

Flexible trade execution
Access liquidity via the central limit order book, block trades, and RFC

Safety and security
Central clearing helps mitigate counterparty credit risk in our CFTC-regulated marketplace

Overnight electronic access
Act as market-moving global news & events unfold, in a market that trades during extended hours

Futures leverage
Control a larger notional value for a relatively small amount of money, enhancing your buying power

Key Reports/Factors that Move Markets

Weather Events Across the world, the local weather in specific growing regions may impact the supply and thus the price of corn

USDA World Agricultural Supply and Demand Estimate (WASDE) Report offers a monthly comprehensive forecast that often shifts the corn market in an unexpected direction

USDA Prospective Plantings Report This report, issued in March, details the quantity and type of crop U.S. farmers intend to plant in the world’s top exporting nation for corn

Grain Stocks Reports Issued four times a year by the National Agricultural Statistics Service (NASS), these reports offer updates on stocks of corn and other major grain & oilseed crops by state and by position (on- or off-farm storage)

Crop Production Reports Weekly U.S. export report from the world’s largest exporting country for corn offers insights into global demand

Check out the “Learn about Key Economic Events” course and economic release calendar at the CME Institute to learn more.

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