Funds avoid transition to bear territory in CBOT soybeans -Braun

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NAPERVILLE — Speculators nearly abandoned bullish bets in Chicago soybeans last week as global supplies are seen sufficiently building over the next year, but a short-covering bounce mid-week prevented an official move to the bearish side.

Soybeans are the only U.S.-traded grain or oilseed in which funds’ net long has persevered since 2020, though money managers have been bullish soybean meal since late 2021.

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Most-active CBOT soybeans fell 3% in the week ended May 23, at one point trading at the lowest levels since last July. Money managers that week cut nearly 20,000 contracts from their CBOT soybean net long, which fell to 4,147 futures and options contracts.

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That is their least bullish soy view since April 2020 when they briefly dabbled on the short side, and the latest move consisted mostly of exiting longs.

Most-active soybeans have shed more than 12% this year, more than in most years, though they bounced 1% over the last three sessions. November soybeans were up a tick over that period, though Thursday’s bottom of $11.63-1/4 per bushel was the contract’s lowest since December 2021.

CBOT wheat and soybean meal in the week ended May 23 fell nearly 4% and 5%, respectively, though fund selling was lighter than it may seem. Money managers extended their net short in CBOT wheat futures and options to 118,788 contracts from 112,769 a week earlier.

They also reduced their net long in CBOT soymeal to 73,789 futures and options contracts from 80,287 in the prior week.

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For CBOT wheat, the week ended May 23 featured the most-active contract’s first sub-$6 trading in more than two years, though wheat has not settled below $6 per bushel since December 2020.

Both CBOT wheat and soymeal futures slid 1% between Wednesday and Friday, including a $395.60 per short ton print on Thursday, the most-active’s lowest since Oct. 7, 2022.

CBOT corn and soybean oil have been on the uptrend recently. Most-active CBOT soyoil on May 17 hit the lowest levels since February 2021 but drifted fractionally higher in the week ended May 23.

Money managers extended their net short in CBOT soyoil futures and options by about 500 contracts to 36,877 as of May 23, their most bearish since August 2019. Futures have risen 2.2% over the last three sessions.

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CBOT corn drifted slightly lower in the week ended May 23, and money managers added more than 6,000 contracts to their net short, which reached 98,027 contracts.

However, most-active corn surged 4.6% in the last three sessions, on Friday closing above $6 per bushel for the first time since April 26.

New-crop December corn rose 3.4% over the last three sessions, including a three-week high on Friday. Friday’s 3.6% gains were the most for any single session since last July, and the close of $5.34-1/2 per bushel was also new-crop’s best in three weeks.

Although the U.S. summer growing season has begun efficiently, the last couple weeks have been dry, and much of the Corn Belt could remain dry into mid-June, raising the risk of early yield losses. Karen Braun is a market analyst for Reuters. Views expressed above are her own.

(Writing by Karen Braun; Editing by Andrea Ricci)