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Column: Funds seen as net sellers in CBOT corn, wheat, soy so far this month

Speculators ended January extending length in Chicago-traded corn and soybeans and cutting back on bearish wheat bets, though selling may have dominated so far this month, especially late last week.

The U.S. Commodity Futures Trading Commission resumed publication of Commitments of Traders (CoT) on Friday after having been down for nearly a month after a ransomware attack on Ion Markets disrupted collection of data.

CFTC published data for the week ended Jan. 31 on Friday and announced plans to expedite the backfill of data, with the goal of completion by mid-March.

As of Jan. 31, money managers held a net long of 219,924 CBOT corn futures and options contracts, a net long of 175,504 contracts in CBOT soybeans, a net long of 140,943 contracts in CBOT soymeal, a net long of 31,224 contracts in CBOT soyoil, and a net short of 63,628 contracts in CBOT wheat.

That week, funds were net sellers of soyoil, some 4,738 contracts’ worth, but they were net buyers in everything else. That included 18,127 contracts of corn, soybeans 29,242 contracts, soymeal 5,440 contracts and CBOT wheat 10,305 contracts.

In the most-actively traded months, CBOT corn futures were fractionally higher in the week ended Jan. 31, soybeans and wheat more than 3% higher, soymeal more than 5% higher and soyoil 2% higher.

Funds’ Jan. 31 net long in soymeal was near all-time highs and their soybean stance was the most bullish since April, but their soyoil view was the least bullish since August. Funds’ Jan. 31 net long in corn was the highest since November, and their net short in CBOT wheat as of Jan. 24 had been the strongest since May 2019.

Daily fund estimates collected by Reuters suggest that between Feb. 1 and Feb. 24, commodity funds were net sellers of 26,500 CBOT corn futures and 34,500 CBOT wheat futures. Selling among soybeans and soyoil was predicted at 7,500 and 8,000 futures contracts, respectively, and funds were pegged as net buyers of 6,500 meal contracts.

Through late last week, this month’s trade in corn and soybeans had been rangebound, staying within 2% up or down. Wheat and soybean meal had been up as much as 5% mid-month, including a nine-year high for soymeal of $508.20 per short ton.

But corn fell nearly 4% between Thursday and Friday and wheat on Friday alone fell almost 4%. The U.S. government on Thursday put out an optimistic forecast for the recovery of domestic corn supply into 2024, and China on Friday called for peace in Ukraine on the one-year anniversary of Russia’s invasion.

CBOT March and May wheat futures on Friday settled at the lowest levels since September 2021, safely below the pre-invasion levels, before Ukraine’s grain exports were severely disrupted. May wheat settled at $7.21-3/4 per bushel on Friday.

May corn settled at $6.49-1/4 per bushel on Friday, the lowest in two months, though the close in new-crop December corn was a six-month low at $5.76-1/4.

Huge selling surges have not been funds’ style in the last couple of years with the bullish commodities storyline, but there have been a few heavier weeks in corn. Most recently, funds sold about 71,000 CBOT corn futures and options in the first week of December on a near 5% decline in futures.

Lighter market participation in wheat has limited moves. Money managers have not been net sellers of more than 25,000 CBOT wheat futures and options combined over a four-week span since late 2021.

Karen Braun is a market analyst for Reuters. Views expressed above are her own.
Source: Reuters (Writing by Karen Braun Editing by Matthew Lewis)

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