Funds added more than 20,000 gross shorts in CBOT corn futures and options through Nov 21, — Reuters
SPECULATORS are building up big short positions in US grain futures on plentiful global supplies, though a tighter oilseed market and weather concerns in South America have kept funds long the Chicago soy complex.
In the week ended Nov 21, money managers’ combined gross short positions across Chicago Board of Trade (CBOT) wheat, corn, Kansas City (KC) and Minneapolis wheat futures and options surged 8% to 645,074 contracts, the highest since May 2019, following a notoriously bearish time in the markets.
Money managers’ net short in CBOT wheat futures and options rose to a 23-week high of 108,176 futures and options contracts as of Nov 21 versus 89,271 a week earlier.
That included the addition of nearly 20,000 gross shorts, the most for any week since early 2019.
Funds added more than 20,000 gross shorts in CBOT corn futures and options through Nov 21, the most in three weeks, resulting in a managed money net short of 185,502 contracts versus 163,486 in the prior week.
That is funds’ most bearish corn stance since June 2020.
Money managers added considerable gross shorts in KC wheat futures and options through Nov 21, pushing their net short to 47,513 contracts from 37,449 a week earlier.
That is among funds’ all-time bearish KC views given the record of 58,866 contracts set in May 2019.
Funds’ Minneapolis wheat views remain near record-bearish, though they were slight net buyers in the week ended Nov 21.
Slow US wheat demand, cheap Black Sea wheat, a record US corn crop and better prospects for Argentina’s upcoming corn harvest have all weighed on the grains in recent sessions.
On Monday, the US Department of Agriculture said 50% of the domestic winter wheat crop is in good or excellent condition, up substantially from 34% a year ago.
In the week ended Nov 21, CBOT March corn fell 1.1% and March wheat declined 2.5%, though they shed 2.8% and 3.7%, respectively, in the following three sessions.
On Monday, CBOT corn and all US hard and soft wheat futures hit contract lows during trading, including the lowest price for most-active corn since December 2020.
Unfavourable weather in top soybean exporter Brazil has lifted CBOT soybean futures this month but a potential change in the weather pattern caused a fractional decline in January beans in the week ended Nov 21.
Money managers that week trimmed their net long in CBOT soybean futures and options to 81,587 contracts from 87,913 a week earlier, and the new stance is nearly identical to funds’ year-ago stance.
It was also the first week in six where speculators cut gross bean longs.
Funds’ bullish soymeal views rose for a sixth straight week through Nov 21, to 137,803 futures and options contracts from 131,404 in the prior week, and the resulting net long is the largest since early March and by far largest for the date.
Open interest in CBOT soybean meal futures and options surged 4% during the week to another record of 671,039 contracts. January futures fell 3% in that week but had notched a contract high on Nov. 15.
Through Nov 21, money managers cut their net short in CBOT soybean oil futures and options to a near-flat 2,831 contracts from 6,597 a week earlier but soyoil futures shed more than 4% over the last three sessions.
On Monday, soyoil was trading 30% lower than on the same date last year.
Soybean meal eased 1.2% in the last three sessions while beans lost 3.4% after dry parts of Brazil received rain over the last few days.
However, rainfall patterns in Brazil remain irregular and soybean planting pace is at an eight-year low. — Reuters
Karen Braun is a market analyst for Reuters. The views expressed are the writer’s own.
