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Column: Funds end 2022 upbeat in CBOT soy complex, mixed on grains

NAPERVILLE, Ill., Jan 2 (Reuters) – Speculators finished 2022 on a less bullish note across Chicago grains and oilseeds than in the previous two years and were far less enthused with corn and wheat, though their optimism in the soy complex is stronger than a year ago.

Ongoing drought in top soybean meal exporter Argentina lifted money managers’ net long position in CBOT soybean meal futures and options to near record levels as of Dec. 27, marking funds’ fifth consecutive week of buying.

The managed money meal net long of 129,989 contracts, up about 8,700 on the week, rivals May 2018’s high of 133,549. However, other reportable speculators were a bit more bullish in 2018 versus now.

Managed money net position in CBOT soybean meal futures and options

Most-active CBOT soymeal futures on Friday hit $476.10 per short ton, its highest since March 31, and the contract rose more than 5% in the last three sessions. Most-active meal added 18% in 2022, the largest gain across CBOT grain and oilseed contracts.

Data published Friday by the US Commodity Futures Trading Commission also showed the overall speculative CBOT soybean long as of Dec. 27 was slightly larger than the year-ago level. That is supported by a heavier managed money net long: 128,616 futures and options contracts now versus about 98,000 a year ago.

Most-active CBOT soybean futures on Friday settled at $15.24 per bushel, their highest since June. The contract rose 13.8% on the year, including 2.8% gains over the final three sessions.

CBOT soybean oil futures expanded 13.3% in 2022 after increasing by a third in 2021, though they declined 3.5% in the latest three sessions. Through Dec 27, money managers added nearly 7,500 contracts to their soyoil net long, which reached 65,587 futures and options contracts. That compares with 45,394 a year earlier.

The four-session week ended Dec. 27 featured money managers’ largest weekly round of corn buying since November 2021 on a 3.5% bump in futures, and new longs accounted for three-fourths of the move.

Managed money net position in CBOT corn futures and options

However, funds’ new CBOT corn net long of 159,315 futures and options contracts, up 45,500 on the week, is far smaller than the year-ago 373,345. Most-active corn rose 14.4% in 2022, including a two-month high of $6.85 per bushel Friday. That compares with a near 23% boost in 2021.

CBOT wheat futures reached a one-month high of $7.99 per bushel Friday, though the contract added only 3% this year after a 20% jump in 2021. Friday’s settle of $7.92 is just 9% above the year’s low, set Dec. 6.

Money managers bought 3,100 CBOT wheat futures and options contracts in the week ended Dec. 27, trimming their net short to 56,212 contracts, much more bearish than the year-ago 11,773.

Open interest in CBOT wheat futures and options had ended 2021 at the lowest point for the date since 2008. But as of Dec. 27, it was 11% lighter than a year ago, though still safely above 2008.

Money managers are mildly bearish Minneapolis wheat versus decently bullish a year ago, and they are nearly flat in Kansas City wheat compared with a record net long for the date last year.

Karen Braun is a market analyst for Reuters. Views expressed above are her own.

Editing by Sam Holmes

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Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Karen Brown

Thomson Reuters

As a columnist for Reuters, Karen focuses on all aspects of the global agriculture markets with a primary focus on grains and oilseeds. Karen comes from a strong science background and has a passion for data, statistics, and charts, and she uses them to add context to whatever hot topic is driving the markets. Karen holds degrees in meteorology and sometimes features that expertise in her columns. Follow her on Twitter @kannbwx for her market insights.

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