Grain Basis Tracker & Map

Understanding Grain Basis

Basis is the difference between your local cash price and the corresponding futures contract price. It's quoted as: Basis = Cash Price − Futures Price. For example, if December corn futures are $4.50 and your local elevator bids $4.20, your basis is −30 cents (often written as “30 under”).

Why Basis Matters

When you hedge grain with futures or forward contracts, you lock in a futures price but your actual sale price depends on basis at delivery. A farmer who sells December corn futures at $4.50 with a −30 basis nets $4.20. If basis strengthens to −15 at delivery, they net $4.35 instead. Understanding your local basis patterns helps you:

• Time your sales better — sell when basis is seasonally strong
• Evaluate elevator bids — is −35 basis good or bad for your area in March?
• Compare delivery points — a 10-cent basis difference on 50,000 bushels is $5,000
• Set basis contracts — lock in basis when it's favorable, set futures later

Seasonal Basis Patterns

Basis follows a predictable seasonal pattern in most Midwest markets:

• Harvest (Oct–Nov): Basis is weakest (most negative). Elevators are full, farmers are delivering, and transportation is bottlenecked.
• Winter (Dec–Feb): Basis begins to recover as harvest pressure eases and stored grain moves to market gradually.
• Spring/Summer (Mar–Aug): Basis typically strengthens as grain supplies tighten before new-crop harvest. This is often the best time to move stored grain.

Location Factors

Proximity to demand makes a big difference. River terminals (St. Louis, Minneapolis) and ethanol plants typically offer stronger basis because they have lower transportation costs to end markets. Interior locations far from major demand centers tend to have wider basis to account for trucking and rail costs.

Frequently Asked Questions

What is basis in grain marketing?

Basis is the difference between your local cash price and the corresponding futures price (Cash Price − Futures Price). It is typically quoted in cents per bushel and is usually negative, meaning your local cash price is below the futures board. Basis varies by location, time of year, and local supply and demand conditions.

When is basis typically strongest for corn and soybeans?

Basis tends to be strongest (narrowest/closest to zero) in the spring and summer months when grain supplies tighten before new crop harvest. Basis is typically weakest (widest/most negative) during and immediately after harvest in October and November, when local elevators are flooded with supply.

Why does basis vary by location?

Basis varies based on proximity to end users (ethanol plants, feedlots, export terminals), local supply and demand, transportation costs, and storage capacity. River terminals and export facilities typically have stronger (narrower) basis because of lower transportation costs to market. Interior locations far from demand centers tend to have wider basis.