NAPARVILLE – Speculators have been selling hot Chicago-traded soybean meal hotly over the past week as prices have fallen to a four-month low, but they continue to hold a long position in corn.
According to the US Commodity Futures Trading Commission, money managers reduced their net long on CBOT soybean meal futures and options from 52,314 a week ago to 17 May to 35,923 deals.
This puts the total at three- and four-week sales at record levels. During the four-week period ending May 17, the futures of the most active food fell 10.4% but fell as much as 14%. The contract actually rose 2.6% in recent weeks.
Money managers sold 63,619 soybean meal futures and alternative contracts in the four weeks ending May 17, equivalent to about 12% of expected U.S. food production in 2021-22.
CBOT Oilshare, which measures the share of soybean prices in soy products, reached a record high on May 12 and fell last week. Soybean futures have risen 4.4% in the last three sessions but soybean oil has declined 3%.
Money managers cut their CBOT soybean oil net through more than 2,000 deals in the week ended May 17, resulting in 86,237 futures and alternative deals.
The most active CBOT soybean oil has mostly traded for a month now at its previous unprecedented 80-cents level, settling at 80.93 cents per pound on Friday. Indonesia, the world’s top exporter of palm oil, backed higher prices on April 26 due to a ban on palm oil exports.
Indonesia said on Thursday that the ban would end on Monday, despite domestic cooking oil prices remaining above the proposed target. However, Jakarta said on Friday that it would re-impose an internal sales requirement, effectively blocking some exports.
In that news on Friday, the benchmark Malaysian palm oil futures rose 3%, although prices have fallen more than 12% since the day before the ban took effect. But prices are still about 50% higher than a year ago, which was a record level for the date.
Corn, soy, wheat
CBOT Corn Futures rose more than 3% in the week ended May 17, but Money Managers added just 1,000 contracts to their Corn Net Long, reaching 339,711 futures and alternative contracts. The longest since October has exceeded 300,000 contracts.
Money managers snatched a three-week selling streak on CBOT soybeans as of May 17, raising their net long 147,335 futures and options contracts from 130,661 a week earlier. It is based entirely on fresh Long and has come up with a 5.4% increase in the most active futures.
Maize has fallen nearly 3% in the last three sessions as U.S. farmers continue to make progress in their historically slow planting efforts, but soybeans have jumped 1.6%. Top corn exporter Argentina said on Thursday that it could increase its 2021-22 corn export cap from 30 million to 35 million tonnes at present.
Chicago wheat futures rose nearly 17% in the week ended May 17 as India banned exports due to high domestic prices and a small crop. The deal traded as high as .8 12.84 per bushel, reaching just five trading days in history.
India will ship a record amount of wheat in 2022-23, at least 8.5 million tonnes, which is about 4% of global exports. As of Thursday, the government is considering allowing some of the wheat, up to 1.8 million tonnes, stranded at the port to be shipped out.
In the week ended May 17, Money Managers raised their net to 26,586 contracts on CBOT wheat futures and options, their highest bullish since March 2021. It rose to 15,547 a week ago and represents only a fraction of the expected purchase.
In the week ending May 17, open interest in Chicago wheat rose 14%, the highest for any week since 2006, but it is still the lightest since 2009.
The futures of the most active CBOT wheat have declined 8.5% in the last three sessions as investors booked profits. Trade sources suggest that the commodity fund sold 37,000 futures contracts during that period, which would shorten the real-time net. Karen Brown is a Reuters market analyst. The opinion expressed above is his own.
(Edited by Matthew Lewis)