NAPERVILLE — Speculators’ optimism throughout U.S. grain and oilseed futures has returned to late June ranges amid elevated shopping for in Chicago-traded corn and soybean merchandise, an unusual development main into U.S. harvest.
This yr’s quick U.S. corn and soybean crops and the continued tensions between Ukraine and Russia have solely worsened world grain provide uncertainties, which have been outstanding for 2 years now. However a possible slowdown within the world economic system poses threats to speculators’ bullish grain bets.
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Within the week ended Sept. 20, cash managers lifted their internet lengthy place in CBOT corn futures and choices to 247,909 contracts from 240,643 per week earlier, in accordance with information printed Friday by the U.S. Commodity Futures Buying and selling Fee.
That marked funds’ eighth consecutive week of internet shopping for within the yellow grain and produced their most bullish corn stance since June 21. Most-active CBOT corn futures rose 15% in these eight weeks, remaining just below $7 per bushel at their peak.
Corn futures settled at $6.76-3/4 per bushel Friday, easing with broader commodities and equities, although they continue to be on the second highest ranges for the date behind 2012. Subpar world crops have supported corn futures, however demand considerations loom.
The 2022-23 U.S. corn harvest is within the early phases, although sowing has simply begun for Argentina. Excessive dryness there has already prompted trade analysts to chop crop forecasts.
Information final week confirmed U.S. gasoline demand at a 24-year low for the center week of September, a crimson flag for corn-based ethanol demand. Nonetheless, in some nations, excessive costs for conventional gasoline have spurred demand for cheaper choices together with ethanol blends.
SOYBEANS AND WHEAT
Most-active CBOT soybean futures have been unchanged within the week ended Sept. 20, although cash managers trimmed their internet lengthy by greater than 7,000 to 104,691 futures and choices contracts. That’s properly above the year-ago ranges and about common amongst latest weeks.
Cash managers’ bullish CBOT soybean meal views are simply report excessive for the date, surging by greater than 14,000 contracts by means of Sept. 20 to 102,168 futures and choices contracts. That was related to a 3.7% bounce in futures, and it was funds’ greatest meal shopping for week since November.
December soymeal futures hit a contract excessive of $443.80 per quick ton Thursday however settled decrease Friday at $423.30, some 24% stronger than the year-ago value.
CBOT soybean oil futures fell greater than 1% by means of Sept. 20, however cash managers added about 3,000 contracts to their internet lengthy, which reached 58,310 futures and choices contracts. Funds have purchased oil in seven of the final eight weeks and meal in seven of the final 9.
However a worldwide financial slowdown may quickly hit soybean and different world vegoil costs. An trade main analyst on Friday stated Malaysian palm oil futures might be a 3rd decrease by the tip of the yr based mostly on elements like demand destruction.
A pause in wheat promoting since final month has allowed for the rise in collective grain and oilseed optimism. Cash managers stay bearish Chicago wheat, although they have been internet patrons for a fourth straight week by means of Sept. 20, leading to a internet wanting 15,703 futures and choices contracts.
Cash managers have been bullish Kansas Metropolis wheat for greater than two years, elevating their internet lengthy barely within the newest week to 19,059 futures and choices contracts. They flipped again to a internet lengthy in Minneapolis wheat for the primary time since July with internet shopping for at 2,520 futures and choices contracts, essentially the most for any week since April.
Most-active CBOT wheat closed above $9 per bushel on Wednesday and Thursday, the primary $9-plus settles since June, because the battle between main wheat exporters Russia and Ukraine deepened. Nonetheless, wheat shed greater than 3% Friday as U.S. equities and crude oil plunged. Karen Braun is a market analyst for Reuters. Views expressed above are her personal.
(Modifying by Leslie Adler)