Grain and oilseed prices are in a kind of downward race

Grains, Cereal & Legumes
Market & Price Trends
Published Mar 1, 2024

Tridge summary

Hedge funds and speculators have made the largest negative bet in nearly 20 years on corn, wheat, and soybeans, with a net short position of 546,000 futures contracts, due to falling prices from increased production. Despite this, commercial players who purchase physical grain are betting on rising prices, increasing their net long positions. Analysts predict that the current crop shortage could lead to a price recovery, and the large speculative bets could potentially trigger a larger rebound than the market fundamentals would typically justify.
Disclaimer: The above summary was generated by a state-of-the-art LLM model and is intended for informational purposes only. It is recommended that readers refer to the original article for more context.

Original content

Corn prices have been falling since 2022. Source: The Financial Times Hedge funds and other speculators have accumulated a net short position of 546,000 futures contracts in all three crops – the largest negative bet in nearly 20 years, according to the latest data from the U.S. Commodity Futures Trading Commission. The rate increased as prices fell due to increased production in major agricultural countries, including Brazil, Russia and the United States. Corn futures on the Chicago Mercantile Exchange fell to $4.22 per bushel, and wheat futures below $5.72, which is about 50% below the highs reached in May 2022. Soybean futures were down to $11.46 per bushel, compared to more than $17 earlier in the month. “Such a prolonged negative trend attracts sellers,” said Ole Hansen, head of commodity strategy at Saxo Bank. “As long as the market remains in a downtrend, short positions will be maintained and potentially even strengthened,” he added. The current price drop is in stark ...
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