Managed investment funds continue to pile on long positions in Chicago Board of Trade corn futures amid searing heat and the worst drought in nearly 25 years across the Midwest.
Large managed funds, including hedge funds, held a net-long position of 201,956 CBOT corn contracts in the week ended July 10, up 16.6% from the prior week, according to the Commodity Futures Trading Commission.
The net position is the difference between the number of long contracts, or bets prices will rise, and short contracts, or bets prices will fall.
Funds held 230,550 long contracts against 28,594 shorts. Corn and soybean futures both continued to soar during that period, with soybeans setting a fresh all-time high and corn approaching its record high.
The activity precedes Wednesday's U.S. Department of Agriculture supply-and-demand report, in which the government slashed its yield projections. Weather forecasts continue to offer little relief.
Money managers maintained their massive net-long position in CBOT soybeans during the period. They were net long 250,792 contracts, an increase of 710 contracts from the prior week.
Managed funds expanded their net-long position in CBOT wheat futures by 16.9% to 62,468 contracts. Although wheat supplies aren't as tight as those in corn and soy, the high corn prices are expected to lead to increased wheat demand.
The USDA also tightened its wheat supply outlook on Wednesday. Funds held a net-short position in wheat futures as recently as June...
Source: Argentine Beef Packers S.A.
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