Canada Markets                03/24 11:10

   Soybean/Corn Price Ratio Supports Shift to Soybeans

   The soybean/corn price ratio certainly supports a shift in area from corn to 
soybean planting this spring, but it will need to be monitored for signs of 
that transition being too great.

Mitch Miller
DTN Contributing Canadian Grains Analyst

   As producers are trying to put the final touches on seeding intentions going 
into spring, the soybean/corn price ratio is not only useful for comparing 
relative profitability but also provides an early warning sign should the 
market be encouraging too large of a swing between alternatives. The current 
level of 2.51 seen on the accompanying chart certainly does support the notion 
of more land going into soybeans at the expense of corn this coming year. But 
will it be too much?

   As previously mentioned, the soybean/corn price ratio is simply the price of 
soybeans divided by the price of corn. It is designed to represent the profit 
potential advantage of one crop compared to the other, thereby impacting 
seeding decisions. The market's reaction to the upcoming planting intentions 
report and the impact on the ratio is important in predicting what to expect 
for final seeded area.

   As a refresher, the benchmark used for decades as the tipping point has been 
a ratio of 2.5 (see the blue line on the accompanying chart). For example, $10 
soybeans/$4 corn = 2.5 with no expected impact on acres based on profitability 
factors in such a case. A higher value suggests that soybeans will be favored 
with a value below 2.5 suggesting corn acres should rise (at the expense of 
soybeans).

   I still believe that is somewhat obsolete given the rising costs associated 
with growing corn over the past few years, especially fertilizer (and 
especially now) and the increased interest on that outlay. It may be petty, but 
I think a value closer to 2.3 is more likely the current tipping point (see the 
red line on the accompanying chart).

   Before moving on, I would like to draw your attention to 2022 as a prime 
example. As you can see, the ratio spent all the time between March 2021 and 
June 2023 below 2.5. By the classical benchmark, that would have suggested high 
corn acres for 2022 and 2023. Instead, 2022 corn acres fell 4.7 million from 
2021. In my opinion, the ratio spending much of 2021 and the first two months 
of 2022 above 2.3 was enough to promote soybean seeding, considering the 
sticker shock from skyrocketing fertilizer prices from September 2021 through 
2022. A key point to keep in mind for the coming crop considering the 
fertilizer price shock producers are sure to endure.

   It is much easier to look like you know what you're talking about when it is 
clearly above 2.5 (2023-24 for example, that led to the large soybean area in 
2024) or clearly below 2.3 (early 2024-25 for example, that led to the record 
corn area in 2025).

   As you can see by the accompanying chart, 2026 looks like a slam dunk for a 
large shift in those flex acres back to soybeans using the ratio of 2.3 as the 
tipping point. The jump in soybean prices in early 2026 thanks to expectations 
for a surge in soybean crush requirements to feed record setting biofuel demand 
sent the ratio up to 2.70 -- suggesting producers would likely swing heavily 
back into soybeans this year. With last week's sharp break in soybeans over 
concern about President Trump's delayed trip to China, it has pulled back to 
just over 2.5 but still favors soybeans.

   At the Agricultural Outlook Forum, USDA was expecting a nearly 
5-million-acre decline in corn area for the coming crop with a nearly 
4-million-acre increase in soybeans. But that was before the war with Iran and 
the resulting closure of the Strait of Hormuz was even a consideration. With 
the spike in fertilizer prices and concern over availability, the swing into 
soybeans could easily be even more exaggerated.

   That is where it will be important to monitor the ratio following the March 
Prospective Plantings report. There is a real risk of too large a swing to 
soybeans considering the record corn demand, something that could occur should 
the ratio move back up and over 2.7 again. It will be vital for the corn market 
to hold steady relative to soybeans following the seeding intentions report.

   And just to be clear, when I am referring to flex acres, they are merely 
those fields that are not pre-determined based on non-economic factors such as 
crop rotations, soil conditions, disease or insect limitations, that sort of 
thing. It is not a program phrase (clarifying mostly for our Canadian friends' 
sake).

   I welcome feedback along with any suggestions for future blogs. My daily 
comments can be found in Plains, Prairies Opening Comments and Plains, Prairies 
Quick Takes on DTN products.

   Mitch Miller can be reached at about:blank

   Follow him on social platform X @mgreymiller




(c) Copyright 2026 DTN, LLC. All rights reserved.