(The opinions expressed here are those of the author, a market analyst for Reuters.)

NAPERVILLE, Illinois - After building immensely bullish bets, speculators in late February rode out Chicago corn’s worst downturn in over a year as the United States prepared to upend global trade.

Most of those long positions were dumped during March as economic uncertainties intensified, and corn futures sank to three-month lows by the end of March.

But those who stayed the course were rewarded last week. CBOT corn surged 6.5% between Monday and Friday, the most-active contract’s best five-day stretch since late 2023.

Washington on April 2 announced steep tariffs on goods from almost every country, though much of that was walked back on Wednesday, with hefty rates remaining against China only.

The U.S. Department of Agriculture on Thursday cut domestic corn supplies to a level that suggests nearby corn futures could be undervalued, adding fuel to the ongoing rally.

Despite many other commodities notching sizable losses amid the escalating global trade war, CBOT corn had drifted 1.6% higher in the week ended April 8, notching their highest prices in over two weeks.

That strength may have aroused suspicion among money managers, who trimmed their net long in CBOT corn futures and options to 53,576 contracts from 56,757 a week earlier, driven by an increase in gross short positions.

But corn futures jumped 4.5% in the following three days and most-active CBOT soybeans added 5%, both reaching six-week highs on Friday.

This confused some investors as the United States and its top soybean buyer China ratcheted up tariffs against one another throughout the week. However, China rarely does business in the U.S. soy market at this time of year since Brazilian supplies are plentiful.

The late-week bean rally was not friendly for money managers, who through April 8 had boosted their net short in CBOT soybean futures and options to a 15-week high of 50,447 contracts. That compared with 29,847 in the prior week.

SOY PRODUCTS, WHEAT

Short covering was rampant in CBOT soybean oil for a second straight week amid volatility in global vegoil prices. Money managers established a net long of 30,125 soyoil futures and options contracts as of April 8 versus a net short of 5,762 a week earlier.

Money managers slightly trimmed what had been a record net short in CBOT soybean meal futures and options, resulting in a net short of 97,630 contracts. CBOT soymeal added 3% over the last three sessions, on Friday topping $300 per short ton for the first time in three weeks.

CBOT wheat futures also reached three-week highs on Friday with a settlement price of $5.55-3/4 per bushel. That is nearly identical to the same date a year ago, when funds held a net short of about 87,000 contracts.

As of April 8, money managers’ CBOT wheat net short totaled 102,132 futures and options contracts, down about 10,000 on the week.

Funds also remain heavily bearish in the other wheat flavors. Their net short in Kansas City wheat futures and options, some 49,834 contracts as of April 8, is their largest since May 2019.

Money managers’ net short in Minneapolis wheat futures and options as of April 8 reached a 13-week high of 28,844 contracts, not far off the record.

This week, traders will continue to monitor any headlines on U.S. tariffs, but they will also be watching the start of the U.S. growing season. As of Sunday, U.S. corn is about 5% planted, on average. Karen Braun is a market analyst for Reuters. Views expressed above are her own.

(Editing by Cynthia Osterman)


Reuters