Funds, index traders carrying big longs in CBOT corn and soybeans -Braun
23/11/2020 12:30
(Repeats item from Sunday with no changes to headline or text)
By Karen Braun
FORT COLLINS, Colo., Nov 22 (Reuters) - Speculators have
maintained heavily bullish bets in Chicago-traded corn and
soybeans for at least a month now as the supply picture grew
significantly tighter than anyone expected. But other market
participants have also been very active lately, adding to the
overall optimism.
As of Nov. 17, the managed money net long in CBOT corn
futures and options was at 278,889 contracts, a decrease of less
than 2,000 contracts from the prior week. Corn futures had
fallen fractionally during that week, but heavier fund selling
had been expected. (https://tmsnrt.rs/2UL7YQn)
Data from the U.S. Commodity Futures Trading Commission also
showed a reduction in the funds’ soybean net long to 208,774
futures and options contracts in the week ended Nov. 17.
urn:newsml:reuters.com:*:nAQN03EPHS That compares with a net long of 221,094 contracts
a week earlier. (https://tmsnrt.rs/3909uGz)
Investors’ bullish soybean view is basically the same as
eight weeks ago, though most-active futures Sv1 have risen 16%
or more than $1.60 per bushel since then.
Corn futures Cv1 are up by the same percentage,
representing 59 cents per bushel, but funds were far less
bullish several weeks ago. Their net long in corn was just
95,912 futures and options contracts on Sept. 22.
Money managers are not the only ones placing big bets on
corn and soybeans. Traders in the ‘other reportables’ category
drastically increased gross soybean longs in the two latest
weeks, and their corn net long at the end of October came within
less than 2,000 contracts of the all-time high set in early
2018.
When combining the managed money and ‘other reportables’
views, the resulting net soybean long has been hovering at
record highs for nearly two months. The combined corn net long
has been above 400,000 contracts since late October, slightly
off the record levels observed in late 2010 and early 2011.
Index traders have shown a particular interest in corn since
mid-October, with the combined number of gross longs and shorts
up 30% since then. Outright longs numbered 542,021 futures and
options contracts as of Nov. 17, just 200 off the all-time
record set exactly 10 years earlier. (https://tmsnrt.rs/3kP6UWl)
Index traders' gross soybean longs hit a record on Oct. 20
and there has not been significant pullback since then.
Corn open interest as of Nov. 17 was up 17% since
mid-October, last week reaching the highest level in more than a
year and easily the highest level for the time of year since
2010. Soybean open interest rose 11% in the two weeks ended Nov.
17 and is very comfortably the largest for the time of year, but
it is off mid-October’s all-time high.
Commodity funds were seen as net buyers of both corn and
soybean futures over the last three sessions as most-active
futures rose 2% and 1%, respectively. urn:newsml:reuters.com:*:nL1N2I62J7 Deferred
contracts were weaker, with November 2021 soybeans SX1 and
December 2021 corn CZ1 up just 0.2% each.
Both most-active contracts hit milestones on Friday.
Soybeans reached $11.96-3/4 per bushel, the highest since June
13, 2016, and corn touched $4.33-1/4, its highest since July 24,
2019. Tightening supplies, strong demand and dryness concerns
for South American crops continued to be in focus late last
week.
WHEAT AND SOY PRODUCTS
Chicago wheat futures continue at elevated levels for this
time of year, but they have come off the mid-October highs, and
speculators have been heavier sellers in the latest two weeks.
Through Nov. 17, they reduced their net long to 14,414 futures
and options contracts from 32,633 in the prior week.
Traders have been weighing concerns over exportable supply
in top countries such as Russia with the expectation for record
global production and stocks. Futures were up fractionally
between Wednesday and Friday, and commodity funds were pegged as
light buyers.
Funds’ Kansas City wheat views were barely changed for the
second consecutive week, as they expanded their net long by 638
futures and options contracts to 47,967 through Nov. 17. But
they trimmed their Minneapolis wheat net long by 747 contracts
to 6,061.
Investors have not held a net short in the CBOT oilshare
since April, and their net long reached a two-month high last
Tuesday. The oilshare measures soyoil’s share of value in the
soy products.
Tight supplies continue to be a concern for global vegetable
oil markets. Most-active soybean oil futures BOv1 surged 4% in
the week ended Nov. 17, and money managers raised their bullish
stance to 103,778 futures and options contracts from 97,111 a
week earlier.
Futures rose another 3% over the last three sessions,
reaching 39.32 cents per pound on Friday, the highest for the
most-active contract since July 2, 2014.
Soybean oil futures are influenced by price trends in
competing vegoils. Malaysian palm oil futures FCPOc3 on
Thursday hit the highest level for the benchmark contract since
May 3, 2012, but traders are also monitoring a potential
pullback in global vegoil demand given soaring prices and
increasing coronavirus infections.
Money managers eased bullish views in soybean meal through
Nov. 17, reducing their net long to 78,486 futures and options
contracts from 83,798 a week earlier. Futures fell fractionally
between Wednesday and Friday, but funds are still expected to be
holding a record-large meal long for the time of year.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic- Managed money net position in CBOT corn futures and
options https://tmsnrt.rs/2UL7YQn
Graphic- Managed money net position in CBOT soybean futures and
options https://tmsnrt.rs/3909uGz
Graphic- Commodity index traders’ total outright positions in
CBOT corn futures and options https://tmsnrt.rs/3kP6UWl
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Editing by Tom Brown)
((karen.braun@thomsonreuters.com; Reuters Messaging:
karen.braun.thomsonreuters.net@reuters.com; Twitter: @kannbwx))