What I'm buying 30 Days into the IRAN US War
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30 days into the US–Iran war, most markets have already reacted.
Oil has surged.
Volatility has picked up.
Narratives are everywhere.
Equities are bleeding.
But when you step back, corn has barely moved.
That’s what makes this interesting.
Corn isn’t in a clean trend right now. It went through a major bull cycle post-Covid, followed by a sharp bear unwind into 2023–2024. Since then, it’s settled into a broad sideways range roughly between the low 400s and high 400s.
The aggressive selling phase has already played out, but there hasn’t been a strong new catalyst to drive a sustained move higher. So price has been compressing.
Corn is currently in a basing phase.
It’s waiting for a macro or supply-driven trigger to determine the next directional cycle.
Let’s talk about supply and demand.
The reason it’s been stuck like this comes down to supply.
The USDA has been very clear. We are still dealing with a massive amount of corn. The U.S. just came off record production. Ending stocks are still sitting around multi-year highs, the largest in roughly seven years.
That kind of supply overhang keeps a lid on price.
Even with strong exports and steady demand, there’s simply too much corn available right now for the market to move aggressively higher.
On the demand side, nothing has really changed….yet.
Ethanol, which is one of the biggest drivers of corn demand, is basically flat. The USDA is still projecting around 5.5–5.6 billion bushels going into ethanol, which is essentially unchanged year over year.
So despite higher oil, the actual demand engine that would push corn higher hasn’t kicked in yet.
That’s the key reason (I believe) why price has barely moved.
Ethanol: Where this entire trade outcome lays
The relationship is simple, but the timing is not.
When oil rises, gasoline becomes more expensive, which makes ethanol more competitive as a blend.
But ethanol producers don’t instantly increase demand just because oil spikes for a few days.
They need sustained margins.
They need confidence that higher prices will hold. Once that happens, they start pulling more corn into production, and that’s when demand actually shifts.
When that shift occurs, it’s not gradual. The market has to reprice quickly because it’s now dealing with a different demand curve.
This is the feedback loop.
Oil stays high → ethanol margins improve → ethanol demand increases → corn demand increases → price reprices.
That’s where the current macro setup comes in…
The US/Iran War pushed oil higher. But corn hasn’t followed in any meaningful way. It’s only up about 4% since late February.
Heer’s a chart of /ZC Futures:
So while Corn has moved basically 20 cents from 446 to 466, Brent is up dramatically more over that same period.
It’s even more remarkable when you look at them on a comparison chart:
That disconnect is the opportunity.
The market sees what’s happening, but it doesn’t believe it yet. It’s waiting to see if oil stays elevated or if this fades like every other geopolitical spike. That’s why corn hasn’t moved. The market isn’t convinced it has to.
The Market Needs Convincing.
Here’s Where
Markets move when participation changes.
Right now, managed money isn’t fully involved. The COT report shows funds are present, but not aggressively positioned.
There’s no crowding, no urgency.
If oil stays elevated and ethanol margins start to show up in the data, that’s when funds step in. And when they do, they don’t ease in, they move size. That’s when you get expansion.
Note: I wrote about this in “When the Environment Changes”
So what’s changed technically?
Looking at the daily chart, corn is starting to shift from pure range to early structure. You’re seeing higher lows form, price holding above recent levels, and a push back toward the middle of the range. It hasn’t broken out yet, but it’s no longer drifting lower. If this is real, the next step is continuation. This is where we continue pushing higher and holding, much like oil has done.
RSI is starting to reflect that shift. It’s no longer stuck in the lower range like it was during the downtrend and is beginning to build higher. As I’ve talked about in When Do Trends Change?, trends don’t flip all at once.
You get warning signs first, then confirmation.
Right now, we’re getting warning signs.
So what am I actually looking for as confirmation?
I want to see three things.
First, oil needs to stay elevated. We already spiked to $120 and came back into the $80’s early on. Now, we’re maintaining and building momentum….back above $110 as this war lingers on.
This maintained elevation is what drives the entire ethanol story.
Second, I want to see it show up in positioning. Managed money needs to start stepping in. We should see increasing longs and reducing shorts. That’s when I believe it’s clear this is no longer just a narrative, it’s something funds are actually acting on.
Third, price needs to confirm it. That means continuation higher and holding those gains.
Until then, notably, this is still early.
Which brings me to my position.
I’m long /ZCK26 from 466.
I’m fine being early here because the risk is clearly defined. If this is wrong, corn goes back to pre-war levels around 440. That’s roughly 20–25 cents of downside.
But if oil stays elevated and ethanol demand starts to shift, corn doesn’t stay up 4%.
It reprices.
And that move is not 20–25 cents.
That’s the trade.
I’m buying the setup before it’s confirmed, because of the risk:reward being as clear as can be. I have a clear level where I’m wrong.
If I’m right, participation comes in later.
And later could be in a few short weeks…
As always, do your own research. I could be wrong. This could blow up. Your account is your account and you have to own your own decisions 😊. Futures are leveraged products and contain significantly more risk than buying the stock. Using ticker CORN or buying options on the /ZC futures contracts is a way one could reduce risk.
Cheers,
PriceTrader