Speculators a week ago appeared content with their bearish views in Chicago-traded corn, but damage to Ukrainian river ports early last week forced them into bullish territory, especially with Chicago wheat soaring the daily limit.
Several terminals at Ukraine’s Black Sea ports, which handles most of the country’s grain exports, had been struck by Russian missiles in the prior week following Moscow’s withdrawal from the year-old grain export deal.
In the week ended July 25, money managers established a net long position in CBOT corn futures and options of 26,603 contracts, their first bullish corn stance in four weeks. That compared with a net short of 46,926 contracts in the prior week, and two-thirds of the latest move was caused by short covering.
CBOT corn futures had risen almost 6% during the week, though CBOT wheat surged over 13%, including a limit-up move on July 24. Open interest in wheat futures and options jumped more than 7% through July 25, coming within 1% of the same week last year despite having been 9% lower a week earlier.
Money managers through July 25 cut their net short in CBOT wheat futures and options to 40,332 contracts from 54,418 in the prior week, entirely on short covering and marking their least bearish wheat stance in 38 weeks.
Grain futures did not sustain their strength last week, and funds may have already abandoned bullish corn bets as of Friday’s close. Corn dropped over 6% in the last three sessions and commodity funds commodity funds were pegged as net sellers of 33,000 futures contracts.
CBOT wheat futures still maintain some of their recent Ukraine war premium, having shed 7.4% between Wednesday and Friday. Funds were seen as sellers of 24,000 wheat futures during this period.
The late week decline in grain futures came despite another Russian attack on Ukraine’s Odesa port on Thursday, though traders are hopeful that the European Union can assist with most of Ukraine’s exports if the grain deal is not restored.
Hot and dry weather in the U.S. Corn Belt last week added some support to corn futures, though forecasts early on Sunday suggested the return of more favorable weather in early August.
SOYBEANS AND PRODUCTS
Money managers have held a net long position in CBOT soybean futures and options ever since April 2020. As of July 25, they established their most bullish late July soy view since 2016, increasing their net long to 120,739 contracts from 95,814 a week earlier.
Most-active soybean futures gained 1.8% in the week ended July 25, though soybean oil surged 7.5%. Money managers increased their net long in CBOT soyoil futures and options to a 28-week high of 54,190 contracts from 44,914 a week before.
Soybean meal futures were unchanged in the week ended July 25 but had risen as much as 2%, which had funds padding bullish bets. The managed money net long in CBOT soymeal futures and options rose to a nine-week high of 70,174 contracts from 58,949 a week earlier.
Source: reuters.com
Photo Credit: gettyimages-fotokostic
Categories: Illinois, Crops, Corn