Last week, speculators covered short Chicago corn and soybean positions, reducing their large negative wagers as futures rose from multi-year lows. Mostly due to short covering, money managers reduced their net short position in CBOT soybean futures and options to 155,137 contracts from a record 171,999 the week before. Funds were net bean purchasers for the first time in 17 weeks, snapping a record selling streak.
The week's most-active CBOT soybean futures rose 4% and 6% from their Feb. 29 low, the lowest since November 2020. Most-active corn futures climbed 9% from their lowest since November 2020 late last month on March 12.
Money managers cut gross short positions for the second time in three weeks as corn rose 3.6% in the week ending March 12. From 296,795 a week earlier, their net short reduced to 255,928 futures and options contracts.
The managed money corn net short reached a record 340,732 futures and options contracts on Feb. 20, but recent short covering brought funds' March 12 position equal with the 2019 record net short. Six weeks later, pre-2024 record short was attained.
A huge year-on-year boost in global maize and soybean supplies cut prices and forced speculators into record short bets, but part of that selling may have been overdone, especially with problematic weather in Brazil and the U.S. planting season ahead.
Last Monday, CBOT wheat futures hit contract lows, but they only fell slightly during the week ended March 12. Money managers sold about 13,000 futures and options contracts that week, increasing their net short to 78,870 contracts, their lowest since December.
China's cancellations and postponements of U.S. and Australian wheat shipments and large Russian wheat supply have weighed on the wheat market. Between Wednesday and Friday, futures lost 3.5% but remained above the March 11 low. CBOT soybean products moved in the week ending March 12 as soybean oil rose over 6%. Money managers dropped their soyoil short to 33,410 futures and options contracts from 62,473 a week earlier, their greatest net purchase since September 2019.
Money managers' soyoil views are more optimistic than their soymeal forecasts for the first time since November 2022, suggesting bullish positioning in the CBOT oilshare. Oilshare quantifies soyoil's worth in soy products. Friday saw soybean oil hit two-month highs, up 9% in March and matching rival global vegetable oil prices. Short supply and robust demand drove benchmark Malaysian palm oil futures to seven-month highs earlier this month.
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