cancel
Showing results for 
Search instead for 
Did you mean: 
Veteran Advisor

Funds Buy, Farmers Sell Record Amounts of Corn

On Friday, the COT Report showed that outside investors bought a record amount of CME Group corn futures and options contracts, for one week, ending May 21, totaling 166,189.
 
Farmers sold a record amount of corn contracts (for a week), totaling 159,778.
 
So, the outside investors remain net short the corn market holding 116,729 vs. 282,918 the previous week.
 
What say you?
 
 
Thanks,
 
Mike
0 Kudos
9 Replies
Advisor

At bout $4.80 bu

Near board the funds might start to awake up.

 

Even losing dough won't matter to fund managers.....they just make it back on their avg of all positions.

0 Kudos
Advisor

Re: Farmers sell 798 million bushel.

Farmers sold 798 million bushel of corn a couple of weeks too soon.  I figured to sell some corn when it got to $4.25.  We'll see if I right to hold out a bit longer or not.

0 Kudos
Senior Contributor

Re: Farmers sell 798 million bushel.

I think you'll have an early Christmas this year. Keep some in reserve, this market has some real potential if we settle above $4.1225...

0 Kudos
Esteemed Advisor

Re: Funds Buy, Farmers Sell Record Amounts of Corn

Mike, I am far more interested in the "spreading" category. That has grown to a 2.25 BIL bu position, with a 435,000,000 increase just in this week, almost half of the farmer selling. No one can answer who this is and what is the spread they are trading, maybe you could recommend some expert who could help me try to figure it out.

 

Just from a math perspective, a spread trade of 2.5 BIL bu, in a market with a zero carryout, creates some very serious liquidity issues. This might be the 1996 HTA event all over again.

0 Kudos
Highlighted
Senior Contributor

Re: Funds Buy, Farmers Sell Record Amounts of Corn

If you think that this rise in corn is a one time event due to the flooding inb the MidWest this year, then a long 2019/short 2020 and beyond spread makes a lot of sense. I think that is the way many of the funds are viewing this price increase, and so the spread trade is going along for the ride. 

 

Now if it turns out that there is a new dynamoic in the corn market which will keep prices higher for longer than 2019, then the long spread trade could get kind of ugly over time. 

0 Kudos
Honored Advisor

Re: Funds Buy, Farmers Sell Record Amounts of Corn

Image result for bull on rocket

0 Kudos
Senior Contributor

Re: Funds Buy, Farmers Sell Record Amounts of Corn

Been a long time coming but that's what the chart looks like right now...and if prices go a bit higher that bull will have steam coming out of his nose.

0 Kudos
Advisor

i don't see $8 corn yet, but

$6 Cash corn at harvest Is Certainly Achievable .....granted $5 comes first.

And the afore is in normally wide supposed basis areas.

0 Kudos
Honored Advisor

Re: i don't see $8 corn yet, but

Keep on selling guys.  The more corn that is sold at these prices, the higher the price can go later.  Might be a good idea to keep some of the powder dry for a better day down the road. 

0 Kudos