By Karen Braun
FORT COLLINS, Colo., Oct 31 (Reuters) – Speculators added more Chicago-traded grains and oilseeds to their portfolios during the last full week of October as futures continued to rise, despite global supply predictions edging upward during the month.
Investors’ interest in corn continues to be much stronger than that for soybeans. They also maintained a pessimistic CBOT wheat outlook in the latest week, just before futures hit nearly nine-year highs.
In the week ended Oct. 26, money managers increased their net long position in CBOT corn futures and options to 244,790 contracts from 219,568 a week earlier based on data from the U.S. Commodity Futures Trading Commission.
Funds held a net long of 276,235 corn futures and options contracts in the same week last year. So far this calendar year, their least bullish corn view was 208,799 contracts on July 13 and their most bullish was 401,993 on April 13. (https://tmsnrt.rs/3mssTGB)
In CBOT soybean futures and options, money managers lifted their net long to 23,911 contracts through Oct. 26 from 18,165 in the prior week, which was nearly a 17-month low. They have avoided bearish territory in soybeans since April 2020.
Soybeans Sv1 were the only most-active CBOT grain or oilseed to end October lower, though they fell only a half percent. Corn futures Cv1 rose 5.9%, their biggest gain for the month in seven years and greater than the October 2020 rise of 5.1%.
That has sharply reduced the value of soybeans relative to corn, which is used to guide next year’s profitability prospects for U.S. farmers. However, analysts have been concerned that high fertilizer costs will limit 2022 corn acres despite the yellow grain’s attractive price.
Energy prices hovering at multiyear highs have also lent support to grain and oilseed futures, especially pertaining to U.S. ethanol production. Surging profit margins have boosted output of the corn-based biofuel near all-time records in the latest two weeks.
Some industry participants have otherwise struggled to explain recent market strength with big U.S. corn and soybean crops and Brazil seemingly on its way to success. U.S. export demand has been OK, but many traders are bothered by China’s slow soybean bookings.
SOY PRODUCTS AND WHEAT
Soybean meal and Chicago wheat are the only two grain or oilseed contracts where investors remained bearish through Oct. 26. In CBOT wheat, money managers cut their net short to 8,619 futures and options contracts from 17,738 a week earlier. (https://tmsnrt.rs/3EvJ5Nk)
Most-active CBOT wheat futures Wv1 on Thursday and Friday hit $7.80 per bushel, their highest levels since February 2013. The contract added 6.5% during October, though funds have mostly been short since mid-September.
Most-active CBOT soymeal futures SMv1 ended at $332.60 per short ton on Friday, its highest settle in a month as it notched a 1.2% gain for October. Soybean oil futures BOv1 rose 4.4% for the month but ended the last three sessions down 1.7%, weakening with crude oil and other global vegoils.
Money managers slightly extended their net long in CBOT soybean oil futures and options to 85,631 contracts through Oct. 26, a gain of 3,420 on the week. That is their most favorable view since the beginning of June.
Minneapolis wheat futures MWEZ1 hit a 10-1/2 year high on Friday of $10.58 per bushel amid tight world supplies of high-protein wheat. Through Oct. 26, money managers added 192 contracts to their net long in spring wheat, boosting it to 16,512 futures and options contracts, their highest since March.
Their Kansas City net long reached its highest level since February at 52,973 futures and options contracts, up nearly 5,600 on the week. December futures KWZ1 on Thursday hit $7.97-1/4 per bushel, the highest since May 2014.
Global wheat export demand is healthy despite lackluster U.S. sales as of late, though top exporter Russia’s recent grain harvest continues to be downgraded, and the region remains dry for the newly sown crop. Paris-traded Euronext milling wheat hit more than 13-year highs on Wednesday.
Graphic- Managed money net position in CBOT corn futures and optionshttps://tmsnrt.rs/3mssTGB
Graphic- Managed money net position in Chicago wheat futures and optionshttps://tmsnrt.rs/3EvJ5Nk
(Editing by Matthew Lewis)
(([email protected]; Twitter: @kannbwx))
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