A French farmer, taken with a drone, harvests wheat in his field in Arleux, France. -Reuters
Despite some analyst predictions, speculators were not confident in a bullish scenario for corn and soybeans ahead of last week's reports from the US Department of Agriculture, but they were uncertain enough to refrain from heavy selling. Last Thursday, USDA updated its monthly supply, demand, and production outlooks, which included agency's first objective assessment of US corn and soybean yields.
Industry analysts had expected yields to decline from USDA's long-term trends based on recent low crop ratings, but neither of the average analyst predictions would have shockingly cut the plentiful domestic supply. As such, speculators reduced their net long positions in both Chicago-traded corn and soybean futures and options in the week ended Aug. 8 - just two days before the report - according to data from the US Commodity Futures Trading Commission.
However, it was mostly the result of exiting longs rather than new shorts, particularly in corn. This suggested that while they did not expect a bullish report, they were not confident it would be bearish -- but it was. USDA placed US corn yield at 169.5 bushels per acre and soybean yield at 49.4 bpa, both of which comfortably topped even the highest analyst prediction. New-crop futures fell 3 percent on Thursday, with December corn futures hitting the lowest level since Sept. 30, and November soybeans the lowest since June 30.
-Reuters, Chicago
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