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 mitchmiller.dtn@gmail.com

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