Corn, soybean users snap up supplies as funds sell
The fierce selling by funds of Chicago crops has met with a barrage of buying by commercial operators – solving one market puzzle, but potentially creating another in appearing to downplay the extent of farmer sales.
Investors have questioned how open interest levels – the number of live contracts in place – have remained relatively stable in Chicago corn and soybean futures despite the selldown by funds which has fuelled a slump in prices.
Benchmark December corn futures stand some $1 a bushel below their high last month, with November soybeans down some $1.50 a bushel from an early September peak.
“The market has struggled to explain this massive fund liquidation with open interest only nominally changed,” Kim Rugel at Benson Quinn Commodities.
In the week to last Tuesday, open interest fell by a relatively small 11,000 contracts in soybeans and rose by nearly 30,000 lots in corn, regulatory data late on Friday showed.