Column: Funds unexpectedly sell CBOT corn as end users face unpleasant price tag

FORT COLLINS, Colo. (Reuters) – Speculators were expected last week to have gone on a record buying spree in Chicago corn, but it was a commercial short squeeze that seemed to better explain the highly volatile price activity. In the week ended April 27, money managers reduced their net long in CBOT corn futures and options to 378,663 contracts from 383,998 in the prior week according to data published on Friday by the U.S. Commodity Futures Trading Commission. The trade estimates for the week were wildly off with expectations that funds bought nearly 150,000 corn futures, and this has been a theme in recent weeks. Funds were expected to have bought 66,000 corn futures in the week before last when they actually sold more than 17,000. Recent assumptions about fund activity have seemingly applied greater weight to speculators’ influence on price action than the impact of commercials, and that was on display last week. The rally has forced end users without coverage to acquire supplies at painfully high prices. Commercial end users covered nearly 67,000 corn short positions through April 27, though their shorts still numbered 1.45 million futures and options contracts, more than ever before at this time of… continue reading

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