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NAPERVILLE, (Illinois): Despite the US government’s latest prediction of sufficient global grain supplies over the next year, a dry and hot stretch for the US Corn Belt and Russia’s withdrawal from the Ukraine grain deal kept market volatility alive last week.

Although those factors caused Chicago corn and wheat futures to surge, speculators have held on to their bearish views thus far.

In the week ended July 18, money managers reduced their net short position in CBOT corn futures and options to 46,926 contracts from 63,052 a week earlier. Short covering was prominent in the move, but funds also removed gross longs, suggestive of a cautious rather than a bullish approach.

CBOT December corn futures rallied 6.6% through Tuesday, July 18, though the week included a drop to new yearly lows after the Department of Agriculture expanded the US corn crop outlook. The contract made a record two-day run of 9.3% between Tuesday and Wednesday but stayed well shy of the June high.

Corn eased on Thursday and Friday, notching fractional gains over the past three sessions. If this latest rally is over, that means funds were able to maintain their bearish corn stance without being forced back onto the long side, which happened during the mid-June rally.

Money managers’ net short in CBOT wheat futures and options has barely changed in the latest three weeks despite a 4% decline in most-active futures during the stretch. Through July 18, they increased their net short to 54,418 contracts from 52,128 a week before.

Wheat futures rose 1.6% in the week ended July 18, and although open interest jumped more than 3%, it remains at 18-year lows for the date. The potential severity of Russia’s non-cooperation in the Ukraine grain export deal finally surfaced on Wednesday, sending futures screaming 8.5%.

Weakness in wheat on Friday pared gains to 4% over the last three sessions, and as in corn, commodity funds are not seen as having significantly changed their existing wheat views late last week. SOYBEANS AND PRODUCTS

CBOT November soybean and December soymeal futures climbed 2.6% and 4.3%, respectively, in the week ended July 18. Speculators added new longs and covered some shorts in both commodities.

Money managers increased their net long in CBOT soybean futures and options to a three-week high of 95,814 contracts through July 18 from 82,748 a week earlier. That is basically identical to their bean positioning in the same weeks in 2022 and 2021, and prices were also very similar among the three years before beans’ latest rally.

Through July 18, money managers’ net long in soybean meal also reached a three-week high of 58,949 futures and options contracts versus 54,199 in the prior week. Funds’ view on soymeal has not fluctuated significantly since late May, though futures have drifted 6% higher in the seven weeks since.

CBOT soybean oil futures declined fractionally in the week ended July 18, and money managers trimmed their net long to 44,914 futures and options contracts from 49,572 a week earlier. That was their first net selling week in soyoil since the end of May.

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