FORT COLLINS: Chicago-traded corn futures have recently been on an unprecedented run partially due to supply concerns in South America, and speculators and other traders have further inflated their already very bullish bets in the process.
The most-active CBOT corn contract surged 14% in the second half of December, something not seen in more than three decades. Corn neared $5 per bushel on Monday before ending a tick lower as investors took profits.
In the week ended Dec. 29, money managers boosted their net long in CBOT corn futures and options to 332,045 contracts from 265,713 in the prior week, according to data published on Monday by the US Commodity Futures Trading Commission.
That marks funds' most bullish corn stance since August 2012, and the latest move was predominantly driven by new longs. Futures had risen almost 6% during the period.
Investors added nearly 59,000 new outright corn longs through Dec. 29, the most for a single week since March 2018.
That lifted total longs very close to 400,000 contracts, the most since March 2011.
Money managers were not the only participants last week, as other reportable traders' corn net long jumped to a record high of 167,987 futures and options contracts.
Index traders' outright corn longs reached a new all-time high for a third consecutive week through Dec. 29.Corn futures have risen another 1.3% over the last three sessions, reaching a high of $4.97-3/4 per bushel in the most-active month on Monday, the highest since May 2014.
Trade estimates suggest commodity funds bought 25,000 corn futures over the last three sessions, which if true would lift the managed money net long to its highest level since April 2011.
Money managers have adopted the most bullish corn view relative to soybeans for the time of year since 2014.
That contrasts sharply with their all-time record bullish bet on soybeans versus corn back in June, when funds' corn net short approached 300,000 contracts.
SOYBEANS AND WHEAT
CBOT soybean futures rallied nearly 11% in the second half of December, the most since 2007, but speculators have hardly adjusted their views. Through Dec. 29, money managers boosted their net long to 196,487 futures and options contracts from 188,623 a week earlier.
Funds' soybean long recently topped out at 238,394 contracts on Oct. 6 but has largely drifted lower since, even though most-active futures on Dec. 29 were trading 24% higher than on Oct. 6.
Markets remain laser-focused on the supply situation in South America given how dry the season began in both Argentina and Brazil.
Early soybean harvesting has started in Brazil, albeit slowly, though rains can still help a lot of the later-sown crops.
Most-active soybean futures hit $13.49-1/2 per bushel on Monday, the highest since June 2014. Funds were seen buying 25,000 soybean futures over the last three sessions.
Through Dec. 29, money managers lifted their net longs in soybean meal and soybean oil to the highest levels since June 2018 and December 2019, respectively.
They increased their meal long to 89,487 futures and options contracts from 83,385 a week earlier, and they extended their oil long to 112,989 contracts from 101,253.
Soybean oil futures fell slightly, and meal futures rose nearly 1% over the last three sessions, but funds are expected to have been light buyers of both.
Money managers' net long in CBOT wheat futures and options rose to 13,360 contracts through Dec. 29 from 6,233 a week earlier. That is less bullish than a year ago, but it is uncharacteristically optimistic for the time of year versus other recent years.
Funds lifted their net long in Kansas City wheat to 55,560 futures and options contracts from 51,544 a week earlier, and that new long position is the largest since August 2018. They also increased their Minneapolis wheat long to 3,933 contracts from 2,420 a week earlier.
CBOT wheat hit $6.50-1/4 per bushel on Monday, its highest since December 2014. Wheat has been tracking the grains upward in recent sessions, but traders are also keeping an eye on global export demand as well as prices and shipments out of the Black Sea, the top supplier of wheat.
Wheat futures rose nearly 7% in the second half of last month, the most since 2011. The most-active contract was up nearly 4% in the last three sessions, and trade estimates peg the fund buying at 22,000 futures contracts.