Headlines:

  • Wet US outlook rains on wheat bulls’ parade. But cocoa soars
    Grain futures made a soft start to the week – in particular wheat, which tumbled to one of its lowest finishes of 2017 – but bulls had better luck in soft commodities, with cocoa markets soaring. Traders had cautioned before the session that the modest amount of selling revealed by weekly hedge fund positioning data had left scope for further bearish bets. And funds used the space, in particular in wheat, which for Chicago-traded soft red winter crop, the world benchmark, plunged by 2.3% to $4.30 ½ a bushel for May delivery, the weakest finish since late January for a nearest-but-one contract. The decline – a fifth successive negative session, a run during which the contract has lost 6% – was attributed to growing expectations of rain for drought-hit winter crops on the southern US Plains.
  • Hedge funds extend ag selling – and ‘scope for more sales’ in grains
    Hedge funds cut their net long position in agricultural commodities for a third week, but not by enough, in grains, to fend off fears of a further selldown, with latest bearish positioning focused on sugar instead. Managed money, a proxy for speculators, cut its net long position in futures and options in the top 13 US-traded agricultural commodities, from corn to sugar, by 51,236 contracts in the week to last Tuesday, analysis of data from the Commodity Futures Trading Commission regulator shows. The reduction represented a third successive weekly decline in the net long – the extent to which long bets, which profit when values rise, exceed short holdings, which benefit when prices fall. And it represented selling across all three complexes, with hedge funds cutting their net longs in New York-traded soft commodities, Chicago-listed livestock contracts, and in grains including the soy complex.

Summary:

Corn and Soybean futures were in a grind today with Corn lower with the May contract losing 3.50 cents and the May Beans contract was basically flat losing only 1 tick when the dust settled on the day. The losses in July Wheat futures were the highlight of the day after it surrendered 10.50 cents (2.3%). Wheat prices were under assault because of extended rain forecasts for the plains. Both Wheat and Corn settled near the day’s lows but Beans managed to recover off of the day’s low after posting a fairly tight trading range. After a drought of new Bean export announcements for about a month we opened the day with a 120k tons of Soybeans to un-known. Additionally, the export inspection data was released showing that Corn inspections were their highest of the year. The USDA export pace has now narrowed from 147 to 83 million bushels over the span of the last 6 weeks. Inversely, Soybeans posted its 2nd lowest inspection total of the year.