MW Energy and metals have been hot but a rally for agriculture commodities may now be getting under way, says technical analyst
By Barbara Kollmeyer
Fundstrat's Mark Newton is betting on corn, wheat and soybeans moving higher in 2026
Mark Newton of Fundstrat says soybeans, corn and wheat are likely to get their moment in the sun in 2026, picking up the commodities baton from energy and metals.
Grains are ready to break out and continue a commodities rally that has been driven by energy and metals, according to a technical strategist.
"Technically, agriculture's rally looks to be kicking into gear within the commodity complex at a time when the U.S. equity rally has begun to wobble in recent weeks," said Mark Newton, head of technical strategy at Fundstrat.
Newton said while he expects crude oil to stall out and possibly reverse in weeks to come, some commodities should still work well in the coming months. "It's my technical view that 'softs' should be the next area to rise to show mean reversion to recent strength within the metals and energy complex," he said.
He has been of the view that soybeans, corn and wheat should be turning higher due to the prevailing six-year cycle in grains.
Newton has been tracking the Bloomberg Commodity Index, which has a 34% energy weighting and 27% in agriculture, commenting that most popular indexes and ETFs are heavily weighted to energy. The Bloomberg index has just risen above last month's peaks to the highest levels since 2022, and he believes it could test former all-time highs this year.
The Invesco DB Agriculture Fund DBA tracks an index of 10 agricultural commodity futures contracts, he said. The DBA is up an annualized 13% over three years, 4% over 10 years, and more than 3% over a year, according to FactSet.
Newton said DBA has just surpassed a key technical resistance level, after breaking out of a trendline in early February. Volume expanded on Thursday to the highest levels of the past few years, helping to confirm last month's breakout as investors may be looking for non-tech investing options, he said. He expects the DBA will test last year's $28.49 highs, and $32 above that, which he sees likely in 2026.
Corn futures (C00) this year are up 3% as wheat (W00) has gained17% and soybeans (S00) have climbed 13%.
Respected energy expert Anas Alhajji, noted in a recent interview that 33% of the world's globally traded fertilizers come from the Gulf, with planting season under way in Asia and Europe. Even if the Iran conflict is over within weeks, the fallout will hit consumer prices for months "if the fertilizer issue becomes a food crisis later on," he said.
-Barbara Kollmeyer
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(END) Dow Jones Newswires
March 06, 2026 05:25 ET (10:25 GMT)
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