Despite the growing speculative long position held by non-commercial traders in HRW, soybeans and corn, this group of traders reduced their net-long bullish long position in soft red winter wheat for three consecutive weeks, while The blue bars in the second study’s histogram, have reduced their net-long bullish long position in spring wheat for the last two consecutive weeks starting on November 10.
Although not shown, the hard red spring wheat futures curve (a line graph that connects each consecutive contract close) is on an upward slope and can be seen as bearish until March 2022. For example , today’s December close for the MGEX Spring Wheat December contract at $ 5.46 1/4 / bushel varies to $ 6.01 1/2 / bushel, as of March 2022, with each contract trading at a higher level than the previous one.
This signals a bearish supply situation and can be compared to the market for oilseeds, such as canola. Each canola contract is reversed into a subsequent contract from the January 2021 contract to the November 2021 contract, signaling a strong initial demand, a situation that may lead the producer to sell due to a lack of carryover in the market as buyers want grain sooner rather than later as reflected in the futures market.
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Cliff Jamieson can be reached at [email protected]
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