Crop scouts and grain buyers survey a wheat field in Leoni, Kansas. Reuters Grain and oilseed speculators have not received bullish news with staying power in at least three months now resulting in a huge buildup of short positions, and fund managers remained unimpressed last week even as a new set of supply and demand numbers hit the market.
In the week ended May 16, speculators extended their combined bearish bet in grain and oilseeds - which includes Chicago-traded corn, hard and soft red winter wheat, soybeans, soybean oil and meal, and Minneapolis-traded spring wheat, according to data from the U.S. Commodity Futures Trading Commission.
Combining the seven commodities produces a net short of 373,706 futures and options contracts, which is more bearish than last week's 345,395 contracts but well off the all-time low of 464,376 set back on April 25 . The U.S. Department of Agriculture published its first look at the 2017-18 supply and demand numbers on May 10, which initially drew mixed impressions in grains. Global wheat supply looked bearish on the surface while corn appeared bullish, but interference from large stocks in China skewed the totals and overall market attitude remained essentially the same as it was before the report.
Money managers actually dialed back their net short in CBOT corn futures and options, but the move barely registers on the radar as the 203,909-contract position is the largest-ever for this time of year, well ahead of the approximate 127,000 contracts short on the same date in 2015.
In the week prior, the fund corn short hit 208,642 contracts - the shortest money managers had been since March 8, 2016. Pessimism was the general theme in the wheat market as speculators were either cutting longs or extending shorts in the week ended May 16.
Funds extended their Chicago wheat short position to 121,385 futures and options contracts after two weeks on the uptrend, as the previous week's 107,892 contracts had been the least bearish view in two months (reut.rs/2r0XaB0).
-Reuters, Chicago
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