Money pools to buy more CBOT pills and meals depending on the weather in Brazil and demand in the United States

NAPERVILLE, Ill. (Reuters) – Speculators increased their enthusiasm for soybeans and soybeans in Chicago last week as concerns about crops in Brazil and a tight U.S. meal market made headlines.

In the week ending November 14, money managers expanded net long positions in CME soybean futures and options to an 11-week high of 87,913 contracts from 68,598 contracts the previous week, mostly on total new long positions.

The funds added more than 80,000 contracts to their net positions in the three weeks ending November 14, the largest three-week soybean buying spree since June. January soybean futures on the Chicago Mercantile Exchange rose about 6% over that period, including 2% in the last week.

Money managers through November 14 expanded net long positions in soybean futures and CME options to 131,404 contracts from 111,987 contracts the previous week, as well as in new long positions. This is their most bullish view since March and easily the most bullish for this time of year.

The funds added nearly 100,000 soybean futures and options contracts to their net positions in the five weeks ending November 14, the most during this period since March 2020. January meal futures rose 21% during those five weeks and nearly From 4% recently. week, reaching all-time highs for that date.

Open interest in CME soybean futures and options reached a record high of 646,145 contracts as of November 14, up 6% during the week, up 26% in the past five weeks, and 47% higher than the same week last year when funds were… . The long net meal was also seasonally strong.

Record pre-2023 open interest in meal futures and options was 594,016 contracts set in mid-2018 after drought significantly reduced soybean yields in Argentina, the main source of meal.

Argentina’s soy crop losses were much worse in 2023, causing a shortage in global exportable soybean supplies, driving up meal prices and redirecting export demand to the United States.

Hot, dry weather in central Brazil has also supported the soy complex lately, but rain expected over the weekend into this week stalled the rally late last week. On Wednesday, January meal reached contract highs and the most active soybeans hit their highest levels since late August, but beans have fallen 3.6% over the past three sessions and meal has lost 4.2%.

The price of January soybean oil rose nearly 6% in the week ending November 14, even though money managers reduced their net positions by less than 4,000 contracts to 6,597 futures and options. The price of soybean oil has fallen by more than 1% in the past three sessions.

Grain bears

The most active corn futures contract on the Chicago Mercantile Exchange rose 2% in the week ending Nov. 14, although they hit three-year lows during the week, reflecting the weight of the record U.S. corn crop in the market.

Money managers cut net short positions in CME corn futures and options by about 5,100 contracts to 163,486 contracts as of November 14, the most bearish position for that date since 2017.

CME March wheat futures rose slightly during the week, and funds trimmed nearly 3,000 contracts from massive net short positions, resulting in 89,271 futures and options contracts. Money managers have maintained a net shortage of wheat on the Chicago Mercantile Exchange since June 2022.

Money managers have sold Kansas City wheat futures and options in 15 of the past 18 weeks, and as of November 14, their net short positions reached 37,449 contracts, the most bearish to date.

This is also among the largest net shorts ever for KC funds, with the only larger trades occurring over 17 non-consecutive weeks in 2019.

Money managers through November 14 reduced their net holdings in Minneapolis wheat futures and options to 27,726 contracts from the previous week’s record net 30,998 contracts. is similar to

KC Wheat funds have been very heavy sellers of spring wheat futures since late July.

The Chicago Corn Exchange lost 2.4% in the last three sessions despite unexpectedly large weekly export sales in the U.S., and March wheat fell 3.7%, hitting a seven-week low on Friday. KC’s most active wheat on Friday hit its lowest levels since July 2021.

Karen Brown is a market analyst at Reuters. The opinions expressed above are her own.

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