FORT COLLINS, Colo., Jan 30 (Reuters) - Speculators ramped up bullish views in Chicago corn and soybeans last week with futures notching or nearing new highs, but despite the unusually strong optimism, investors are much less invested than a year ago.
Exportable supplies are of concern across all grains and oilseeds, supporting futures. Drought is threatening corn and soybean supplies in South America, geopolitical tensions could impact wheat and corn shipments from the Black Sea region, and exports have been restricted for Indonesian palm oil, the No. 1 traded vegetable oil.
Money managers in the week ended Jan. 25 added about 39,000 contracts to their net long position in CBOT corn futures and options, which reached 365,605 contracts. That is nearly identical to their year-ago view.
They also added more than 15,000 contracts to their net long in CBOT soybean futures and options, which hit a more than seven-month high of 114,895 contracts. That is based on data published on Friday by the U.S. Commodity Futures Trading Commission.
Most-active CBOT corn and soybeans both jumped 3.4% in the week ended Jan. 25 as the Russia-Ukraine conflict stoked market jitters. Weather for crops in parts of South America had improved, but other areas are still facing iffy conditions.
Money managersâ soybean stance sits below the year-ago net long near 157,000 contracts but is still relatively strong for the time of year. However, commodity index tradersâ total number of soybean positions are 19% lighter than last year and 25% lighter for corn.
Soybean open interest as of Jan. 25 was 33% below a year ago and corn 26% below, though last year was an anomaly. Soy open interest last week jumped 5% to a three-month high but is down 7% from the same week in 2020.
Corn open interest is up 4% from two years ago and through Jan. 25 climbed 4% on the week to a two-month high. Index tradersâ corn positions are 5% below the 2020 levels, but their soybean ones are up 6%.
Soybean futures on Friday set new highs in nearby and deferred contracts, settling at $14.70 per bushel in most-active March, gaining 4.5% over the last three sessions. March corn rose 2.6% in that time frame, ending Friday at $6.36, the most-active contractâs highest since June.
Estimated losses for Brazilâs soybean crop have expanded in recent weeks, with some experts discussing the low 130 million-tonne range versus prior mid-140 million ideas. Analysts are also watching a possible return to dry conditions in Argentina.
Between Wednesday and Friday, commodity funds are pegged as buyers of 22,000 CBOT corn futures and 31,500 CBOT soybean futures.
SOY PRODUCTS AND WHEAT
Speculators have been rebuilding soybean oil optimism lately with global vegetable oil and crude oil prices on the rise. Money managers through Jan. 25 lifted their net long in CBOT soybean oil futures and options to 68,773 contracts.
That is up from the previous weekâs 58,208 and is fundsâ fifth consecutive net buying week, though money managers a year ago held a net long exceeding 100,000 contracts.
Most-active CBOT soybean oil futures gained 5.8% in the week ended Jan. 25 and added another 4.4% in the last three sessions. Fridayâs settle of 65.27 cents per pound is the highest since July and up 15.5% so far this month.
Concerns escalated late last week over global vegoil supplies as Indonesia implemented palm oil export curbs, sending Malaysian palm oil futures to new all-time highs on Friday. Indonesian palm oil exports account for 36% of global vegoil trade.
Soybean meal futures rose fractionally through Jan. 25 and money managers snipped about 400 contracts off their net long, which fell to 64,334. But the most-active contract surged nearly 5% in the last three sessions.
The tension between Russia and Ukraine and possible impacts on exports in the week ended Jan. 25 sent Chicago wheat futures 6.4% higher. Kansas City wheat futures gained 8% during the period and Minneapolis wheat added 4.4%.
Money managers nearly halved their Chicago wheat net short to 13,427 futures and options contracts, and they lifted their K.C. net long to 40,634 contracts from 36,119. But they kept selling spring wheat, reducing their Minneapolis net long to 3,340 futures and options contracts from 3,857.
Wheat closed out last week on a very different note than corn and the soy complex. Chicago and K.C. futures fell 4% and Minneapolis fell 3% between Wednesday and Friday after the recent surge that peaked on Tuesday.
Uncertainties over the Russia-Ukraine clash continued late last week, though U.S. officials as of Friday felt evidence was sufficient to suggest a Russian invasion could occur. read more Both Moscow and Kyiv have downplayed the conflict.
Karen Braun is a market analyst for Reuters. Views expressed above are her own.
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