Net shorts increase for corn, wheat and soybean on WASDE woe: CFTC

Net short positions for managed money increased across soft red winter wheat, corn and soybeans futures contracts in the week ending January 16, data from the CFTC showed late Friday, as funds responded to increasingly gloomy outlooks for world grains following the release of the WASDE report.

Wheat saw the biggest increase, with the net short position jumping by almost 14,000 lots to 142,939, as short positions expanded to 231,085 while longs contracted to 88,146.

The WASDE, released on January 12, was particularly bearish for wheat, with US ending stocks increased to 989 million bushels, outstripping analysts expectations by some 30 million bushels.

Soybeans saw the next largest increase in its net short, gaining 11,000 contracts to 103,397 lots, with nearly all of that increased concentrated in a larger short position.

Managed money increased its short positions from 162,047 lots at January 9, to 173,422 lots by January 16, with WASDE again framing a moderately bearish situation US yields and production were trimmed, but not by as much as analysts had been expecting.

Corn saw a mixed bag, but its substantial short position was bolstered further to take the total short contracts to 438,172 lots – a net short of 226,876 lots and just shy of November 14’s 230,556 lots.

Open interest on corn futures also saw the biggest increase across the main grains and oilseeds contracts, taking it to a whisker short of the 2 million mark at 1.97 million lots.

The WASDE had painted a mixed picture for corn, reflecting a broadly oversupplied global market, the biggest surprises came with no revision to Argentine or Brazilian corn crop estimates.

The trade had expected both production estimates for the South American giants to be reigned in on weather woes, but the USDA chose to leave them unchanged at 42 million mt and 95 million mt respectively.

Data from the CFTC is likely to be affected by the US government shutdown.